Business activities

Management: unit 1

The success or the failure of every company or organisation depends on the quality of their managers. Peter Drucker, an American business professor, explains how the work of a manager can be divided into five tasks:

Planning

A manager has to set objectives and decide how the organisation can reach them. He has to use strategies, plans, tactics, and resources.

Organising

A manager has to analyse and classify the activities and divide the work into manageable activities or individual tasks.

Integrating

A manager has to improve social skills of motivation and communication, make decisions about pay and promotion, and supervise subordinates' work. He also has to work with other people in different areas.

Measuring performance

A manager has to measure the performance of his staff and see if the targets and objectives are being achieved.

Developing people

A manager always has to increase and develop his abilities and skills and at the same time develop those of his subordinates.

A manager doesn’t have to consider only the present but also the future so he can modify or change the objectives by introducing necessary innovation. A good manager must have good relation skills to undertake business relations. In addition, a manager has to deal with any crisis that can hurt the company.

The skills of a manager have to be learned, but they can also be human skills and be a factor that doesn’t depend on the person; some people are born to be a manager and others are not. An excellent manager has to balance good ideas and techniques.

Work and motivation: unit 2

Theory X and theory Y

According to Douglas McGregor, there are two opposite theories of work and motivation. The first is called “theory X” and the second is called “theory Y”.

Theory X

This theory has a pessimistic approach to workers and to working too; people are lazy and avoid work and responsibilities. For this reason, they always have to be supervised, controlled, and told what they have to do. For working, they have to be threatened with losing the job and rewarded. The manager has to follow these types of workers at every moment, and the theory is applied by the manager of factory workers on a large scale.

Theory Y

This theory represents the “knowledge” workers; they will be creative, ambitious, and self-motivated by the satisfaction of doing a good job. It’s a theory more applicable to skilled professionals instead of unskilled jobs. For this reason, we can adopt this theory with specialists, engineers, and even for the manager.

Both theories are based on the “hierarchy of needs” created by Abraham Maslow. Theory X is related to the lower order, while the other is related to the higher order.

Satisfiers and motivation

Everyone supposes that good working conditions and benefits are incentives that can motivate workers, but according to Frederick Herzberg, it doesn’t happen. For him, these aren’t factors that motivate the worker to produce more, but they simply are dissatisfiers when they don’t exist. These factors can include sick pay, pension, and paid holiday. He thinks that a worker who owns these benefits takes them for granted; in fact, he sustains that a reward given becomes a right. A factor to be classified as a “motivator” needs to include things such as having a stimulating and interesting job, or promotion.

Unless people are motivated and want to do a good job, they will not perform well; as we know, there always will be plenty of unskilled jobs or repetitive jobs. In this case, how can we motivate workers? A solution can be to give them some responsibilities as part of a team, or introduce job rotation, with which a worker will not do only one task but rotates and does others. The last thing that a company can do is to allow their workers to identify themselves in an important company, the best in its sector, but it doesn’t always work.

Company structure: unit 3

Wikinomics and the future of companies

The word “wikinomics” comes from the joining of the Hawaiian word “wiki”, which means quick, and economics. Some experts contend that companies in the future will use the internet and wikinomics principles. This new quick economy is based on collaboration with people outside the company and the traditional corporate structure; cooperating with the companies gives them ideas to resolve problems or improve an operation in return for a payment.

We can consider this process as an extension of outsourcing, which means transferring some internal functions of the company to an outside supplier; by doing that, companies aren’t forced to get all their knowledge from their employees.

Company structure

Normally, an organisation has a hierarchical structure or a pyramidal structure, with one person or a group on the top and others below at different levels. For this reason, we can also call this structure a “line structure”. All the people know who their managers are and who their subordinates are, and also know which type of decisions they are able to take.

The activities of most organisations become too complicated to be represented only in one hierarchy. For this reason, they have a functional structure that includes specialised production, finance, marketing, etc. This division has some defects; one is that people only think about the success of their department instead of the success of the entire company, creating conflict between departments over what the objectives are.

In addition, a problem of every hierarchical organisation is that people at lower levels can’t take important decisions and all the responsibilities are owned by their boss. The purpose of modern tendency is to reduce the chain of command to be much flatter. The IT systems have reduced the need for administrative staff and the companies were able to remove layers of workers.

We have to divide small business and large business because, in small business, the manager wants to keep much control over their employees, while in large business, it is possible that the manager delegates decisions and responsibilities to others.

There’s a way to get around hierarchies that use matrix management where people have more than one superior. The disadvantage of this matrix is that some departments become more complex, so it’s necessary to give priority in decisions only to one.

There’s a last way to organise a company structure, and it’s the possibility to create autonomous and temporary groups or teams that have to complete an entire project and split up when it is finished. Even this method has defects because a team may not be good at making decisions, and to do good work, a strong leader is needed to coordinate the project.

Managing across culture: unit 4

When you are dealing with a global multinational company, you have to consider that local differences like cultural habits, beliefs, and principles specific to each market can set up different policies, goals, and objectives.

So the companies that want to be successful in foreign markets have to consider that the local culture characteristics will affect the business. For this reason, a conflict has arisen between globalisation and localisation, leading to the invention of “glocalisation”.

Richard Lewis has classified all the cultures into three poles:

• Linear active: In this pole, we can regroup Britain, USA, Germany, and their cultures that try to act logically rather than emotionally. In fact, they try to respect rules, regulations, and contracts, and they do one thing at a time; they are a type of individualist culture.
• Multi-active culture: Here we find Southern Europe, Latin America, and Africa. They give more importance to feelings, emotions, intuitions, and relationships. Other characteristics include doing many things at one time; they are flexible cultures, good at changing plans, and many times they are happy to improvise. They respect social and company hierarchies and believe that personal relationships and friendships have precedence over rules.
• Reactive culture: This is the example of Asia, where people prefer to react to other positions and decisions; they avoid confrontation, they don’t want to lose face. When they formulate approaches, they try to suit them to both parties.

Recruitment: unit 5

An employee can give notice to the company where he works to inform them that he will leave the job position at the end of his contract. The company has to replace him but first has to discover the reason why he decided to leave. First, the company establishes if there’s an internal candidate or if it has to look to recruit an external person. If there’s no one in the company who can replace the ex-worker, it can hire an employment agency or advertise the vacancy.

When the company receives CVs or resumes, it makes a preliminary selection by creating a short list of potential candidates. Next, it invites the people on this list for an interview and makes a final selection, writing to the others to inform them that they have been unsuccessful.

We have to distinguish the CV from the résumé; the first is more common in Europe and Asia, while the second is in the US. The CVs include photos, while the resumes don’t. Moreover, the CV contains a lot of personal details such as the date of birth, marital status, and include outside work interests.

In general, a CV should be honest without lying about your work experience, has to emphasise your strength, and contain only relevant information. Additionally, we have a covering letter. Its characteristics are: firstly, it has to explain why you want the job and specify the job you are applying for; next, it has to emphasise your skills and show how your experiences and background relate to the job; finally, you have to use formal language.

Women in business: unit 6

You are fired

In Norway, the government has published a list of 12 companies accused of breaking the law, and the reason is because there's a law that forces companies to have at least 40% of their directors female. This law can have advantages for women, but some directors have found problems with it. They sustain that in some sectors like oil, technology, and gas industries, and in all the sectors where it is difficult to find women with experience, it is also difficult to respect this law. Some directors are forced to replace board members who have worked in their company for 20 years or more with someone without the experience and whom they don’t know.