1 Principles of management

Principles of management

Management is a process requiring leading and directing an organization.

Sources human, material, intellectual, financial, intangible (=brand)

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Functions of management:

Planning = generating plans for actions, not forecasting.

o Understanding how the company fits for the next stage, so

shaping the company in order to make it ready.

Organizing = making the optimum use of the sources to reach success.

o Finding the right way is not forever -> changing. (in changing

small companies are in trouble, larger companies have more

possibilities)

Staffing = hiring staff.

o Job analysing and selecting employees.

Good brand > high salary.

Leading = no power, it creates conflicts.

o Being able to share company’s values to go in the same and

right direction.

Making sense of reality.

Controlling = checking progress against plans during the process.

o Motivation = basic in order to make the employees efficient, efforts

o become easier in that way.

How and why firms changed in the last

decades

Product and market orientation

End of ’60 strong demand and uniform customer tastes

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From the ’70 saturation of the market since crisis of 1973. More fragmented

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tastes = customers did not buy products for the first time, they wanted a

difference between the old product and the replacing new one. Necessary to be

close to customers’ needs.

Now:

> Less loyal customers = attracted by new products

> Stronger competition = more competitors imitate products

> More information about products among customers

> Similar products from different competitors

> Larger offer

> Firms try to be single-customer oriented

> Need to foresee new ways to satisfy equilibrium = being driven by

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market request and foresee trends.

Globalisation