Summary
In the following article, reference is made to the importance that must be given in small and medium-sized companies to the issue of organization in general and in particular to the internal organizational structure, seen as the subdivisions that are established from the point of view management and organization, based on specialization and division of labor. In the same way to the definition of functions by positions and the structure of the processes. All this to highlight the negative implications that they have in the medium term for the management of the company, deriving from this the need to evaluate and study the structure, applying the necessary changes when necessary.
The organization in small and medium-sized companies.
Introduction:
The globalization of the economy is already a fact accepted by all, even from the point of view of the term, which for some authors is what is truly novel, considering that because of its content, globalization has its origins long before that is actually believed today.
However, the advances made in computing and communications; the economic growth experienced by the so-called emerging economies, including China with its spectacular appearance on the world economic scene; the relative scarcity of certain natural resources; the change in the geopolitical panorama and the insertion of the countries of the former socialist bloc into the world economy; the proliferation of free trade agreements; competitiveness in costs and prices, among others, have been factors that have conditioned the strengthening of globalization as an apparently novel phenomenon.
From the internal point of view, globalization is a double factor for national economies, especially from the point of view of companies, as beneficial due to market opportunities and investments, it is also detrimental from the point of view of the competition to which local companies are subjected, especially in terms of products and services from countries with lower costs and an adequate quality-price ratio. In this sense, globalization itself is a threat, especially for small and medium-sized companies.
Between this phenomenon on the one hand and, on the other, the tendency of entrepreneurs to stay in the market by increasing their share of participation or penetrating new markets, the level of competition tends to increase. This is an objective fact, in such a way that competition does not establish differentiation and is present to a greater or lesser extent, but always present, in all sectors of activity, so that nothing and nobody is exempt from its effects.
Although competition is a conditioning factor for good work and functions as a natural selection mechanism in the business environment, it is still a threat from the individual point of view, that is, from the perspective and position of the employer. However, despite the fact that, in general, entrepreneurs have the ability to perceive the dynamics of the market and competition, on many occasions they lack the capacity to establish the internal limitations of the organization and the actions to be taken, especially in the face of to the immediate future.
The complexity of the management, the tension of the competition, the problems associated with the low profitability or the little liquidity, or even the euphoria for good rates of growth and profitability, do not allow entrepreneurs in small and medium-sized companies to dedicate time to study where the shortcomings of the organization are, perhaps even imposed by the not always perceptible influence of the environment within the organization.
Among these little perceptible and slow-acting aspects within the system is the organization.
Business organization
Although much has been written and theorized regarding the organization as a function of the management and indispensable from the point of view of the management, as well as the organization from the organic point of view in terms of internal organization and definition of positions and functions, still continues to be a weakness in many small and medium companies.
With regard to the organization in terms of structure, it must be considered that in the same way that it is very difficult for two humans to be completely equal, the same happens in companies. A company does not necessarily resemble another even if they are framed in the same sector and use the same production technology and even a similar production structure. There will always be differentiating factors, not only in the technical-productive order, but also in the social order in terms of composition of the workforce, level of belonging and motivation, level of qualification, relationship with managers, etc. Similarly, there may be differences of a quantitative nature, regarding the number of workers, level of sales, profit, asset structure, market share, among others.These and other differences determine that despite the existence of basic principles to define the organizational structure of companies, as well as typical structures, the management structure, positions, functions and the structure by areas, departments, divisions, managements, etc., will depend on the characteristics, complexity and conditions of each company.
In every company there is the existence of a functional structure based on the activities that must be carried out to fulfill its objective and based on the division of labor. This functional structure generates the existence of different subdivisions between which there will be a certain relationship, whether of cooperation, support or subordination. These subdivisions must have their objectives, tasks and functions defined, as well as the interrelation with the remaining subdivisions of the organization, including the system for obtaining and delivering information.
Seen in this way, everything suggests that the establishment of the organizational structure of companies is an expeditious process, when in practice there are more problems associated with the structure than one can imagine. In principle, it is enough to point out that the structure, functions and procedures cannot be applied mechanically, much less copied. Each company must determine the type of structure that is convenient for it in relation to its level of development, type of activity, internal composition, goals and objectives.
The organizational structure of a company must be seen from a dialectical prism, that is, it will depend on the evolution that the company has over time. The adoption of a structure in a static and immovable way will generate more problems than any entrepreneur can really suppose. The growth and evolution of a company must be accompanied by the necessary changes in the structure, an issue that is generally relegated to the background.
Duplication of functions, double and even triple subordination, improvisation in the assignment of functions, the assignment of diverse functions to the same position, the increase in the complexity of the positions without due support in terms of qualification and remuneration, existence of bosses without subordinates, bosses with an excess of subordinates, lack of due specialization, are some of the problems observed in the organizational structure of companies. All this usually implies the existence of problems such as:
- Delays in the implementation of measures and fulfillment of tasks. Existence of errors in the interpretation of the guidelines, including those that "fall" on no-man's-land. Excess centralism in decision-making. Insufficient authority of the intermediate "bosses." Lack of fluency in processes and tasks Deficiencies in the internal control system Imbalance in workloads Demotivation of staff Insufficient information to workers Existence of conflicts between owners or managers Lack of leadership Bad internal environment.
Although none of them have a direct influence on sales, costs or profit levels, the truth is that in a very overlapping way difficulties are generated in the operation of the system. This influence little measured and nothing quantifiable is what causes employers to pay little attention to this type of issue, with which the company grows with an obsolete structure and in most cases it is mechanically including positions, functions and even links or subdivisions, without previously establishing whether it is the most convenient and appropriate. Ultimately, in the medium term, these problems transcend and affect the normal performance of the system, which will surely translate into effects on the level of growth and development of the company,without discounting that customers are capable of perceiving that something is not working well.
Many companies lack a manual of functions and procedures, and when they do have it they are not able to keep it updated or it becomes just another document, without being properly used in the management process. Nor do they have the requirements for positions based on the functions that the position in question is expected to fulfill, in terms of qualification level, specialty, experience, personal characteristics, etc. These are aspects considered bureaucratic or of little practical use, despite the fact that they are associated with the operation of the system and the most important resource of the production process: human resources.
Every entrepreneur knows that when it is sold it is necessary to collect in order to maintain the operation of the company, however, in general, it is not well defined how the collection process is structured, if it works well or badly, if the control is adequate. From the organizational point of view, the important thing is not to collect, but how to organize the collection process, so that it flows normally. The collection becomes in this case a result of the process.
The same happens with other vital processes for the company, such as sales, payments, purchases, inventories, claims and even maintenance.
These are processes that in the dynamics of the company have to operate in a coordinated and directed manner, but in an expeditious manner. The absence of containers in a factory affects the sales process, but the purchasing process must work in such a way that automatically, by calling it in some way, acts to make the purchase of the containers at the right time avoiding breaks in the cycle. In this simple example several actors intervene: warehouse or warehouse, purchase, transport, accounting and treasury. These five links in the chain must be coordinated to efficiently assume the process in question, guaranteeing not only the adequate supply, but also at the appropriate time, at the necessary levels and with the established control.
A good manager, a good businessman, generally does not stop studying the production or service process and the technological flow, knowing the importance it represents for the results of the company; however, it does not act in the same way in the case of the organizational structure.
David R. Hampton notes in his book ADMINISTRATION, the following:
“The structure depends on the strategy. Compliance with this principle does not guarantee good organizational performance; but its violation if it weakens productivity ”.
The quote is very eloquent to characterize the importance of the structure, although it makes it clear that not only a good structure or an adequate organization will depend on the success of a company. Multiple are the functions, activities, factors, on which the good mission of a company will depend. Not for pleasure the company is considered as a system; it is by its principles and relationships a living entity.
Bosses in a structure
A company should not have more or fewer positions than it really requires depending on its level of development, complexity and the established strategy, but seek savings by way of payment of salaries by not including necessary charges, in order to accounts will have a major negative effect, which is unfortunately not immediately noticeable.
Parallel to the issue of structure, another no less important phenomenon takes place, in this case associated with the process of selecting bosses. In general, in family businesses, which are largely small and medium-sized companies, the number of heads is relatively low, without causing major difficulties, on the contrary, it can be very beneficial in principle. But to the same extent that the company consolidates and grows in terms of sales, number of workers, number of clients and suppliers, among others, the adoption of an organizational and management structure that responds to the new conditions will be essential.. Carrying out various activities will determine the need to divide the tasks assigning managers and executors of the same.In this case, the presence of a single boss, even though this is the owner or owner, can constitute more than a benefit in a detriment to the company, limiting its potentialities. The concept that including personnel in the command structure with responsibilities and rank as bosses may imply loss of power and control is a narrow way of thinking.
Similarly, when deciding to include managerial personnel in the structure of a company, not only the level of reliability should be taken into account, but also the level of preparation, qualification and aptitude. Goodwill is always important, but if you do not know exactly what to do or are unable to make people understand what to do, everything will remain in good intentions, but far from good results.
The best professional is not always the best boss, nor is the most trustworthy the right boss. The selection of bosses is a complex process that goes beyond the empathy, sympathy or professional results that accompany a person.
The bosses constitute the necessary link between the upper level of the company and the workers and workers. On them will fall the responsibility of identifying the workers with the goals and objectives of the organization, guiding them according to the fulfillment of the defined strategy. A good boss, assuming this in all aspects: personal, professional, human, will be a motivating element for his work group, capable of giving synergy to the group.
On many occasions, little is done to keep workers motivated, despite the fact that it has always been said that human capital is the most important resource that an organization has. Companies are forced to invest resources in improving their equipment if they want to maintain quality, sales and productivity, but they do not act in the same way in relation to the workforce. Increased wages, bonuses, incentives of any kind, are generally at a disadvantage. One source of savings is made up of wages and the number of workers, despite the fact that demand is ultimately determined by people's purchasing power. In this sense, the existence of good bosses helps to avoid conflict zones,as long as you can balance the level of demand with motivation and channel the interests and concerns of your group.
conclusion
Unfortunately, as was pointed out at the beginning of this material, entrepreneurs and managers are well occupied with their specific tasks and goals; it is for them that they are ultimately measured and evaluated. This often prevents them from being able to discern the more general problems that are affecting the system, and even when they are able to realize that something is not working well, they cannot dedicate themselves to evaluating how to solve the situation. In the midst of this, they debate without going in search of the necessary specialized help, especially because of the little importance they give to issues such as those that have been explained, because they consider that internally they are in a position to find the solution or because of the criteria of the saving. All this when the theories about administration, management, direction, etc.,they are so fashionable in the business world.
While this happens, the competition maintains its firm step and does not give ground. Those who wish to endure must adapt to the existing situation. Those that do not, will remain in a greater or lesser period of time as mere spectators of a dynamic process that generally does not leave room for rectification.
The development achieved in the scientific, technical and even economic aspects has imposed and deepened specialization, in such a way that an entrepreneur no matter how capable, experienced, intuitive and shrewd he may be, will not be able to assume all the tasks of management, especially when it comes to a growing company.
In current market conditions, the success of a company does not lie only in the efforts it makes, but will depend a lot on the conditions of the environment, for which it is necessary to study and know in depth the interiors of the organization. Internal weaknesses have to be resolved each time, in such a way that the company functions healthily, thus avoiding the constant onslaught of the external environment.
In this sense, issues such as internal organization, management, selection and motivation of staff, are little quantifiable aspects that affect the good or bad results in the management of a company. Although the level of customer service is a non-quantifiable section to which careful attention is paid due to the impact that it increasingly has on the results of a company, the organization should receive similar or perhaps greater follow-up, every time that ultimately will influence the quality of the final product.
Bibliography
- Various authors: Business Economics. Analysis of business decisions. Ediciones Pirámide SAHampton, David R: ADMINISTRATION. Third edition. McGraw Hill.Trent Management. Volume 6, Number 4, June / July 2004
