the main task any manager is effective management. Performance criteria allow you to evaluate in detail the quality of a manager’s work in order to make appropriate adjustments. Assessments should be carried out regularly to identify strengths and weaknesses followed by making timely adjustments.
The essence of the concept
Management effectiveness is an economic category that demonstrates the contribution of the manager and his environment to the overall result of the organization's activities. Many researchers put exactly this meaning into this concept. Management efficiency criteria in this case are presented as performance results and the degree of implementation of the goals and objectives that were set for the current period. The main indicator is profit.
It is worth noting that management efficiency is something that characterizes management as a whole or its individual subsystem. For this purpose, various integral indicators are used, which provide a more accurate digital determination of the results.
It is worth noting that a significant part of the economically active population with the appropriate level of education and qualifications is involved in the management process. Since a large amount of time and money is spent on training such personnel, quite a lot of attention is paid to assessing such a parameter as management efficiency. Performance criteria provide a more in-depth look at this issue.
In theoretical studies, the following varieties are distinguished:
- economic efficiency is the ratio of production and management costs, as well as the results obtained;
- social efficiency is the satisfaction of different categories of consumers with the range and quality of goods and services.
The following concepts should also be distinguished:
- internal efficiency is the achievement of the organization’s own goals at a constant level of costs;
- external efficiency - compliance of the enterprise with the demands and requirements of the external environment.
The evaluation algorithm is as follows:
- defining the purpose of performance assessment;
- selection of criteria and their detailed justification;
- collection of initial data that will be used in the analysis process;
- development of requirements for the resulting indicators;
- development or selection of a methodology according to which calculations will be made;
- carrying out calculations and evaluating the obtained indicators.
Each organization sets itself certain goals. During the evaluation of the final results, certain inconsistencies may be identified. Based on the results of the inspection, a decision may be made to make adjustments. management process or about changes to plans.
Economic criteria for management efficiency
The main goal of management is to continuously improve the performance of the organization. Particularly important is management. Performance criteria can be general and specific. In the first case, the global aspect of performance results is considered. It is important to achieve maximum results with minimal resources.
Partial management efficiency indicators are as follows:
- the level of labor costs of workers involved in the production process;
- rational use of material resources;
- minimal expenditure of financial resources;
- indicators characterizing the use and wear of fixed production assets;
- the size of the production cost (should be kept to a minimum);
- production profitability indicator;
- technical equipment production workshops(compliance with modern achievements of technical progress);
- labor intensity of workers, which is determined by working conditions and organizational structure;
- compliance with cost standards while fully complying with all contractual obligations;
- stability of the number and composition of personnel;
- compliance with environmental standards at the same level of costs.
In order to assess the efficiency of an enterprise, first of all, they use economic indicators. The main one is the ratio of profit to total costs that were incurred in the reporting period. If deviations or unsatisfactory results are identified, factor analysis in order to determine specific reasons.
Components of effectiveness
When assessing the effectiveness of an organization’s management, the following indicators can be used:
- effectiveness, which is manifested in the degree to which the goals set by management are achieved;
- the ability to economically spend material and financial resources, fully satisfying the needs of all structures and divisions of the organization;
- achieving an optimal ratio of the obtained economic results to the costs incurred in the production process;
- the degree of influence of direct or indirect factors on the final result.
Criteria groups
Criteria for assessing management effectiveness are specific indicators that allow you to assess the feasibility and effectiveness of implementing certain measures. Modern economic science divides them into two groups:
- private (local) criteria:
- labor costs of workers involved in the direct production of goods or services;
- expenditure of material resources for management and other purposes;
- costs of financial resources;
- indicators that characterize the use of fixed assets (purpose, wear, efficiency, etc.);
- speed of funds turnover;
- investment payback period (reduction or increase).
- quality criteria:
- increasing the output of products that belong to the highest category;
- environmental responsibility of the organization, as well as the introduction of modern energy-saving technologies;
- compliance of manufactured products with the urgent needs of society;
- continuous improvement of workers' working conditions, as well as their social level;
- saving resources.
It is worth noting that all management efficiency must be accompanied by maximization of product output (or the number of services provided). There should also be an increase in profit levels.
Criteria and indicators of management effectiveness
In order to evaluate the economic results from management activities or decision-making, appropriate methods are used. Thus, the criteria and indicators of management effectiveness are as follows:
- general indicator of management efficiency (ratio of profit for the reporting period to costs allocated to management);
- management personnel ratio (the ratio of the number of senior managers and the total number of employees employed at the enterprise);
- management cost ratio (the ratio of the organization's total costs to management costs);
- the ratio of management costs to the volume of output (in physical or quantitative terms);
- efficiency of management improvement (the economic effect for the year is divided by the volume Money, spent on management activities);
- annual economic effect (the difference between total savings due to implemented management measures and costs multiplied by the industry coefficient).
Organizational management efficiency
Economists identify the following criteria for the effectiveness of organizational management:
- the organization of management entities, as well as the full validity of their activities;
- the amount that is spent on resolving certain issues that are under the control of senior management;
- management style;
- structure governing bodies, as well as the well-established relationship between their various links;
- total costs incurred in maintaining the administrative apparatus.
Any organization strives to obtain maximum benefits. It is worth noting that increasing profits is one of the main parameters according to which management efficiency is determined. Organizational performance criteria in this context imply the final result of the entire enterprise. This is due to the fact that the implementation of plans largely depends on the quality work of managers.
Basic approaches to performance assessment
The most important indicator of the functioning of any organization is the effectiveness of management. Performance criteria can be defined and applied according to several basic approaches:
- The target approach, as the name implies, is associated with assessing the degree to which the planned result has been achieved. At the same time, the action becomes much more complicated if the enterprise does not produce any tangible products, but is engaged, for example, in providing various types of services. We can also talk about intersecting goals. Also, the criteria for assessing the effectiveness of an organization’s management quite often represent a set of formal goals that do not reflect the real state of affairs.
- The systems approach involves considering the management process as a set of input, direct operation, and output. In this case, management of both the highest and middle levels can be considered. Most often, the system is considered in the context of its adaptation to internal and external conditions, which are constantly undergoing changes. No organization can limit itself to just producing products and providing services, because it must act in accordance with market conditions.
- The multi-parameter approach is aimed at covering the interests of all groups formed in the organization.
- The approach of competing assessments allows the use of such criteria for the effectiveness of enterprise management as the control system, as well as internal and external influences. At the same time, the manager quite often faces a mutually exclusive choice.
Assessing the effectiveness of personnel management
Criteria for the effectiveness of personnel management include quality, timeliness, as well as the completeness of the implementation of certain works and the achievement of set goals. The general numerical indicator, according to which the performance of employees can be assessed, is the ratio of the achieved indicators to labor costs for a certain period.
An assessment of the effectiveness of personnel management is usually carried out in order to assess the feasibility and validity of introducing motivational mechanisms or making personnel changes. It is worth considering that personnel costs can be primary (salaries) and secondary ( social services and other costs provided for by law).
The work of employees must ensure the achievement of the set goal. The criteria for the effectiveness of personnel management are, for the most part, specific indicators that are calculated per unit production capacity or manufactured products.
Assessing the effectiveness of the management system
The following criteria for assessing the effectiveness of the management system are distinguished:
- the complexity of the organizational structure and justification for the feasibility of the functioning of each of its links;
- speed of response to newly emerging situations and adoption of appropriate management decisions;
- the strategy in accordance with which the organization as a whole and each of its individual subsystems is managed;
- the costs that fall on the maintenance of the management apparatus, as well as their relationship with the results obtained;
- results of continuous monitoring of the activities of senior management;
- assessment of the impact of the management apparatus on the final result of the enterprise’s activities;
- numerical and qualitative composition of management, as well as the ratio with the total number of employees.
It is worth noting that the results of an organization’s activities depend not only on the efficiency of work production personnel, but also on how well the organizational structure is built. For this purpose, periodic inspections are carried out in order to identify inconsistencies, as well as bring the parameters to modern requirements and standards (criteria for the effectiveness of management systems are used).
Classification of methods for assessing management effectiveness
Criteria and indicators for assessing management effectiveness can be applied in accordance with the following approaches:
- focus on identifying the initially set tasks in order to determine the degree of their implementation;
- assessment of the effectiveness of the management apparatus, as well as the degree to which managers are provided with information and other resources;
- evaluation of manufactured products or provided services in order to determine the satisfaction of the end consumer;
- attracting professional experts to identify weak and strong areas of the organization’s functioning;
- comparative analysis of different points of view of managers or management systems;
- involvement of all parties and participants in management and production process to determine the degree of effectiveness.
Valuation activities may correspond to one of the following types:
- formative:
- determining the discrepancy between the desired and actual state of affairs;
- assessing the production process to determine strengths and weaknesses;
- assessment of the degree of achievement of set goals.
- summing:
- identifying types of products and services that bring real economic benefits in order to eliminate irrational areas;
- studying changes in the well-being of employees and clients as a result of the organization’s activities;
- assessment of the ratio of costs to actually achieved economic results.
conclusions
Management efficiency is economic category, which demonstrates the manager’s contribution to the resulting performance indicator of the organization. The determining indicator here is profit (namely, a comparison of the indicator that was achieved and the one that was noted in the plan for the corresponding period).
Management effectiveness is critical for several reasons. The first of them is that quite a lot of time is spent on training this kind of personnel, and their number is quite large. In addition, senior management is characterized by the highest level of remuneration in the enterprise, which must be economically justified.
Management efficiency can be both economic (return on costs invested in production) and social (the degree of satisfaction of the population with the quality, quantity, and range of products and services). It is also worth separately highlighting internal and external operational efficiency.
To assess the effectiveness of an organization's management, one or more approaches can be used. Thus, the target implies assessing the result obtained and comparing it with the target for the period. If we talk about a systems approach, then we're talking about about the perception of the organization’s work as a holistic process. Multivariate assessment affects all groups that are in one way or another connected with the activities of the enterprise or are interested in its results. It is also worth paying attention to the approach of competing assessments, which takes into account factors in the opposite direction.
When assessing management effectiveness, a number of criteria are used, which can be used independently or in combination. Thus, the main indicator is the ratio of costs and profits received. Also important is the optimal ratio of production workers and full-time management personnel, as well as the costs that are regularly allocated to management. It is important to correlate the last indicator not only with the level of profit, but also with the real volume of products produced (in physical or quantitative terms). Also, when calculating economic efficiency, it is important to adjust the indicators of the industry coefficient values.
It is important to understand that in achieving the success of an enterprise, the main role is played not only by the composition of the production personnel, but equally important are the criteria for the effectiveness of management quality. The correct organizational structure must be selected, which will ensure optimal interaction between all departments of the enterprise, as well as a reduction in communication time.
A distinction is made between the efficiency of organizational processes and the quality of the organization itself. Efficiency depends on the properties of the organizational structure, its working methods and the influence of the external environment. Efficiency manifests itself only as a result of the organization's work.
The purpose of designing organizational structures is to highlight areas of organizational development that seem most effective. One of the tasks in the design process is to develop a mechanism for assessing the effectiveness of the organization and selecting assessment tools. To solve this problem, they examine the features of management, the operating conditions of the organization, the limitations of management, identify efficiency factors and indicators for assessing the interaction between departments and hierarchy levels. The importance of this task lies in the fact that the organizational structure does not exist separately from the overall work process, but influences it. Hence, overall efficiency organization depends on the effectiveness of the organizational structure.
When designing an organizational structure or restructuring a company, you must:
- determine in advance the criteria by which effectiveness will be assessed;
- based on the criteria, form a set of indicators by which the assessment will be made;
- lead the whole mass of indicators to unified system to conduct an analysis taking into account interdependencies across hierarchy levels.
Evaluation criteria, tools and methods for analyzing effectiveness that are used in practice may be different. An efficiency criterion is a general indicator, a rule, on the basis of which the best solution or the best process in an organization is selected. Performance criteria show the most important parameters organization and allow the design of a system of performance indicators to enable subsequent analysis and control.
Performance Evaluation Indicators
Divided into three groups:
- Expressing the final results of activities. Among them: profit growth, production growth, reducing production costs, increasing profitability, improving product quality, reducing production time, introducing new equipment and technologies.
- Expressing the management process:
- performance. Defined as the amount of production per one managerial employee; or the ratio of the growth rate of production per one managerial worker to the growth rate of production per one production worker.
- adaptability, flexibility. Determined using a point system based on expert assessments. They characterize the ability of management to change their behavior style depending on the needs of the organization and the demands of the external environment.
- efficiency. Determined by time indicators (time spent on converting resources into products).
- efficiency. Determined by the level of costs for the management apparatus. Rated by the following indicators: share of management maintenance costs in the cost of production; share of costs for wages managers in the cost of production; change in the amount of profit per employee-manager; share of managers in the total number of personnel.
- reliability. Characterized by uninterrupted functioning of the control apparatus. The reliability coefficient is calculated using the formula:
K = 1 – Kn/Ktot, where
Кн – number of unrealized solutions,
Total – the total number of solutions in the organization.
- linkage coefficient. Determined by the formula:
- duplication factor. Determined by the formula:
- degree of centralization of functions. Determined by the formula:
- coefficient of efficiency of information flows. Determined by the formula:
- controllability level coefficient. Determined by the formula:
Kzv = Pzv f/ Pzv o, where
Pzv f – the number of units in the organization at the moment,
Pzv o – the optimal number of links in the organization.
Kd = Goat/Kn, where
Koz – the number of works actually assigned to departments,
Kn – the number of works determined by the standards.
Kc = Rfc/Rf, where
RFC – number of decisions on a function at the upper levels of management,
Рф – the total number of solutions for a function at all levels of the hierarchy.
Ki = De/Dinput, where
De – the number of cases of effective use of information (measured using documents as an example),
Dinput – the total amount of information at the input (measured in documents).
Ku = Uf/Un, where
UV – the scale of controllability is real,
Un – norm of controllability according to standards.
Other assessment indicators may be used, depending on the specifics of the industry, the size of the organization, levels of hierarchy, etc.
A.G. Gilemkhanov,
Chief Specialist Sales, OJSC "Nizhnekamskneftekhim"
NEWSLETTER 2008. No. 4(23)
EFFICIENT ORGANIZATIONAL STRUCTURE
As the company grows, it becomes more and more difficult to maintain the level of operational efficiency. This is largely due to the increase in the number of employees, and most importantly, to the lack of universal organizational structures and mechanisms for coordinating the activities of employees within the organizational structure. It is generally accepted that there is no best structure for all companies. Moreover, it is believed that during the life of one company it may be necessary to change the form of the organizational structure several times, bringing it into line with the new goals and conditions of the organization's functioning.
However, for large industrial enterprises that have a primarily functional organizational structure, it is very difficult, and sometimes impossible, to move to a new structure. The process of changing it is always long and painful, most often leading to an increase in staff and complete confusion during the first year of activity after the reorganization. It is not for nothing that the organizational structure is compared to the skeleton of the human body.
Taking into account the practical complexity of changing an organizational structure, there is a need to initially build a universal organizational structure that would have the advantages of existing structures and be free from their disadvantages.
Currently, functional, divisional, project, and matrix types of organizational structures are known. They are created taking into account the basis that is most significant for achieving the strategic goals of the organization. The base can be a function, product, region, customer, or project.
Structures whose departments are formed around basic functions organizations are called functional. Structures that take a product, region or client as the basis for grouping are called divisional. The structures formed on the basis of the project are called project structures. Structures in which organizational units are created on the basis of two characteristics simultaneously (functions and project) are called matrix structures.
Unfortunately, each of the listed structures has significant drawbacks. Let's list some of them.
Disadvantages of the functional structure:
1) difficulty in cross-functional coordination. In fact, only one person is responsible for the complete satisfaction of the consumer with the product/service - CEO;
2) overload of management with solving operational issues to the detriment of tasks strategic management;
3) slowness of reaction to changes in the external environment. This occurs due to numerous bureaucratic approval procedures that arise as a result of issues that require coordination of the actions of functional units being brought to the level of top management;
4) departmentalization of divisions. Employees are distinguished by a narrow professional vision of problems, focus on the goals of “their” department to the detriment of the general goals of the organization, managers do not have a systematic approach to solving the general problems of the organization;
5) there are no incentives for the development of the spirit of innovation and entrepreneurship.
Disadvantages of the divisional structure:
1) a gap between the strategic and operational-tactical levels of management is possible. The more independent divisional leaders are from the “higher echelons of power” of the organization, the more dangerous this gap is. Having lost control over the situation in the divisions, the organization’s management is unable to form a realistic overall strategy, and division leaders, deprived of development guidelines, make decisions that are often contrary to the interests of the organization as a whole. Eventually strategic goals
organizations are not achieved, and top-level managers become dependent on divisional management;
2) the problem of coordinating the interests of the organization and its divisions. The autonomy of divisions creates the danger of strengthening divisional “local egoism”, aimed at the advantages of one’s own division to the detriment of the overall result;
3) reduction in the quality of performance of functional tasks. This is caused by the loss of the most qualified specialists due to dulling of their senses professional value;
4) increased costs due to duplication of functional departments at the corporate and divisional levels and suboptimal size of divisions.
Disadvantages of the project structure:
1) a long period of “setting up” the team for work, including periods of team formation, adaptation of its members to each other and normalization of relationships within the team;
2) the problem of employing specialists after completion of the project;
3) duplication of existing functional services in the organization.
Disadvantages of the matrix structure:
1) conflict structure. Undermining the principle of unity of command. Power struggle. Tendency towards anarchy;
2) psychological problems personnel associated with uncertainty and variability of the structure;
3) increase in the administrative apparatus (each specialist has two bosses);
4) lengthening the time frame for making decisions due to the need for numerous approvals.
The above shortcomings force managers to be distracted by the revision of already formed organizational structures and work out ways to eliminate shortcomings, the integration of which only complicates the structure. Therefore, initially the organizational structure should be based on the goals that management seeks to achieve.
The main features of an effective organizational structure are:
1) compliance of the structure with the organization’s strategy;
2) controllability of the structure;
3) absence of contradictions between the elements of the structure;
4) compliance of the status of managers and employees with significance functions performed.
Organizational structure is, first of all, elements and only then static (structures) and dynamic (mechanisms for coordinating activities) ways of interaction between them.
When developing real organizational structures, only job positions are taken as elements, and the interaction between them is established through the division of labor and coordination of work. Typically, the labor process is divided into separate operations and assigned to individual job positions in the organizational structure. This allows you to reduce the loss of working time for switching between different types of activities, polish the employee’s skills in fulfilling assignments.
performed operation and use specialized equipment. The consequence of this is a significant increase in labor productivity. However, a structure where a job position is taken as an element has the following disadvantages:
1) decreasing the importance of functions,
2) predominance " human factor» in matters of distribution of punishments and rewards,
3) distribution of functions and responsibilities taking into account the external feeling of workload of workers, and not taking into account the actual ownership of the function,
4) mixing of functions between departments,
5) the complexity of implementing mechanisms activity management,
6) strong dependence of the importance of the unit on the degree of proximity of individual employees to the highest management team or to government officials,
7) lack of real grounds for layoffs or additional hiring of workers,
8) slowness of reaction to changes in the external environment.
Analysis of signs of effectiveness and practical experience work showed that the organizational structure of a large industrial enterprise in modern conditions, it is more expedient to build from three interconnected structures.
The first structure is the structure of goals. It is the basis of the entire organizational structure and provides the first sign of effectiveness. The goal structure consists of the following elements: organizational strategy, strategic and non-strategic goals, objectives and operational results. The structure of the goals is shown schematically in Fig. 1. The structure of goals allows you to link all the goals and objectives of the organization into a single whole, abandon functions that contradict the strategy, and determine for each performer how his actions contribute to the implementation of the strategy.
The second structure is the control structure
Allows you to project management mechanisms onto the organization’s activities and eliminates contradictions between structural elements. The structure of control elements is formed from vertical and horizontal guides. In Fig. Figure 2 shows one example of a control element structure built on the basis of the goal structure shown in Fig. 1.
The elements of the vertical guide structure of controls are operation, process, function and activity. The first two elements are execution elements (performers), and the last two are management elements (managers).
The vertical guide of the structure of control elements is built on the basis of the structure of goals. To achieve goals, appropriate activities are selected. Depending on the goal, activities can be strategic or non-strategic. Strategic means key species activities that contribute to the achievement of any organizational goal and are of fundamental importance for successful implementation strategies. For example, a strategic type of activity may be sales activities, and a non-strategic type of activity may be
Goal 1 (strategic)
Problem 1.1
Strategy
a r t (s 2 ic)
Problem 1.2
Result 1.1.1
Result 1..2
Result 1..3
Result 1..4
Result 1..5
Result 1. .6
Result 1. .7
Result 1. .8
Result 1. .9
Problem 1.3
Result 1.2.1
Result 1.2.2
Result 1.2.3
Result 1.2.4
Result 1.2.5 Result 1.2.6
Result 1.2.7 Result 1.2.8
Result 1.2.9
Goal 3 (non-strategic)
Problem 2.1
Result 1.3.1
Result 1.3.2
Result 1.3.3
Result 1.3.4
Result 1.3.5 Result 1.3.6
Result 1.3.7 Result 1.3.8
Result 1.3.9
Problem 2.2
Result 2.1.1
Result 2.1.2
Result 2.1.3
Result 2.1.4
Result 2.1.5 Result 2.1.6
Result 2.1.7
Result 2.1.8
Result 2.1.9
Problem 3.1
Result 2.2.1
Result 2.2.2
Result 2.2.3
Result 2.2.4
Result 2.2.5
Result 2.2.6
Result 2.2.7
Result 2.2.8
Result 2.2.9
Problem 3.2
Result 3.1.1
Result 3.1.2
Result 3.1.3
Result 3.1.4
Result 3.1.5 Result 3.1.6
Result 3.1.7 Result 3.1.8
Result 3.1.9
Problem 3.3
Result 3.2.1
Result 3.2.2
Res ultat 3.2.3
Res ultat 3.2.4
Res ultat 3.2.5
Res ultat 3.2.6
Res ultat 3.2.7
Result 3.2.8
Res ultat 3.2.9
Result 3.3.1
Result 3.3.2
Result 3.3.3
Result 3.3.4
Result 3.3.5 Result 3.3.6
Result 3.3.7 Result 3.3.8
Result 3.3.9
Rice. 1. Goal structure
Rice. 2. Structure of controls
activity - accounting activity, which is designed to ensure compliance with legislation through accounting, tax and financial accounting. Activity is a set of functions of objects included in the same system of relations, providing
ensuring the maintenance of the entire system in the same quality and the implementation of certain programs and goals. Activity is an element of a higher order.
Functions are selected to solve specific problems. One problem can be solved by implementing
one or more functions. A function is an external manifestation of the properties of an object in relation to the results of the execution of certain operations or processes in a given system of relations. There can be many results from the execution of operations or processes in the sales service: concluded contracts, conducted negotiations, shipped products, received funds, etc. However, someone must subordinate all these results to one task. If the head of a department in a sales service, which is social system relationships, will not manifest its “properties” in relation to the above “results”, then it will not be able to achieve its task. The function is evaluated by the final result of the function's execution - the degree to which the task is solved in cost terms.
Operations or processes are prescribed to execute specific operational results. An operation is a completed action or a series of actions that have only one of two evaluation criteria: completed or not executed. The operation does not have qualitative content (good or bad), its execution does not depend on the qualifications of the employee. The operation is valued at a price with a unit of measurement: ruble per operation.
A process is a set of actions that is characterized by a beginning and an end. The process has a single evaluation criterion - execution time - and imposes a time frame on the actions included in it. A process is an alternative to an operation. Typically, the more automated the processes in an enterprise, the more operations are used to evaluate employee performance. And vice versa: with little automation, processes gain maximum use. The execution of the process depends on the qualifications of the worker. The higher the qualification, the faster the actions included in the process will be carried out. In other words, the process has qualitative characteristics. The process is assessed by price with a unit of measurement: the ruble per set unit of time (usually “ruble per hour”).
Thus, the activities of the performing employee can be:
Operating room, i.e. presented only as a set of transactions;
Process, i.e. presented only as a set of processes;
Mixed ones. combine both operations and processes.
The most efficient are “operational” enterprises. Typically, a complete transition to operations is achieved through automation of activities using corporate information-integrated enterprise management systems (CIISUP).
Elements of the horizontal guide structure are departments by product, region or client. The horizontal guide structure is designed to ensure the connection of operations and processes performed in relation to the same product, region or client. This is a kind of conveyor belt, where each employee belonging to the same department performs only their own operations and processes. After creating the horizontal guide structure, it is important to ensure:
Accommodation of employees of one department in one room in close proximity to each other;
Assigning bonuses to employees based on the performance of each department.
Thanks to these two conditions, there is no need to introduce an additional manager to manage departments in a horizontal directing structure.
A well-built structure of control elements allows you to:
1) it is easy to form a structure of job positions;
2) clearly determine the organization’s need for employees;
3) assign each official to a specific activity, function, operation or process;
4) avoid inconsistency in the actions of workers.
The third structure is the structure of job positions -
ensures that the status of managers and employees corresponds to the significance of the functions performed. In this structure, an official is just a link between the need to perform specific actions and the department of a specific product, region or client. In Fig. Figure 3 shows the structure of job positions, which is formed on the basis of the structure of goals (see Fig. 1) and the structure of management elements (see Fig. 2).
In the book “Structure in the Fist: Creating effective organization» G. Mintzberg identified five main coordination mechanisms used by organizations for the coordinated implementation of work tasks by departments and individual officials:
1) direct control,
2) standardization labor processes,
3) standardization of knowledge and skills,
4) standardization of release,
5) mutual agreements.
G. Mintzberg argues that each existing type of organizational structure is characterized by a basic mechanism for coordinating work tasks.
However, the proposed new organizational structure effectively uses all five mechanisms of coordination of activities, which are superimposed on the structure of control elements (see Fig. 2).
The direct control mechanism is practically the only tool for solving non-standard problems of interfunctional coordination. In the event of a non-standard problem that requires coordinated actions of different functional units of the organization, the problem is forwarded to a higher level of management - the manager to whom these functional units report. The direct control mechanism in the structure of control elements works in its vertical guide at the level of communication: activity - function.
Standardization of work processes allows you to accurately describe the content of operations and processes performed at the performer level. This description is written in job descriptions. In addition, each operation or process is assigned a percentage,
Head of function 1.1
Head of function 1.2
Head of function 1.3
Head of function 2.1
Head of activity 1
Director
Head of activity 2
Leader Leader Leader
functions 2.2 functions 3.1 functions 3.2 functions 3.3
Head of activity 3
Rice. 3. Structure of job positions
which reflects its importance among other operations or processes within the same function. Through this percentage, based on the results of activities, the wage fund is distributed.
Standardization of skills and knowledge implies that persons with a precisely defined level of training can participate in the labor process. Typically, an organization relies on this coordination mechanism when the tasks facing employees are too complex to standardize the process of solving them or the result. In the structure of control elements, standardization of skills and knowledge is carried out in a vertical guide at the level of control elements such as activity and function . The result of managing activities and functions is assessed as a percentage of the results of execution of subordinate operations or processes.
In contrast to the above mechanisms, the release standardization mechanism works in the horizontal guide of the control structure (see Fig. 2). Plans are established for each product department, region, or customer. The result of work is assessed by the degree of implementation of plans. Depending on the results, bonuses are assigned to employees belonging to the same department. A predetermined percentage of this bonus is awarded to the heads of functions and activities.
There is also a mechanism for mutual coordination in the horizontal guide structure of the control elements. Due to the fact that one department includes employees performing various functions, the approval of documents, contracts and projects in one department can occur more quickly.
efficiently and effectively. An even greater effect can be achieved if performers from one department are placed in the same room.
The proposed effective organizational structure is free from the shortcomings of existing organizational structures and retains their advantages, and also allows you to adapt to any market situation: when it changes, management simply shifts its focus to the horizontal or vertical guide of the system of control elements, without restructuring the entire organizational structure.
One of the main advantages of an effective organizational structure is the complete interconnection of job positions, management levers and organizational goals. However, the proposed organizational structure has the following disadvantages:
1) difficulty of perception. Combining a large amount of information complicates the ability to clearly convey to management and performers the structure’s operation scheme;
2) complexity of construction. The structure forces you to reconsider all existing operations, processes, functions and correlate them with the declared strategy. In addition, it is quite difficult to find a visible result for each operation and set a price for it;
3) the need to maintain an additional team of qualified workers who would build the structure, organize and carry out the transition from existing structure to a new one and supported the logic of the structure in the process of further activities of the organization. In addition, there is a need for this group of workers to agree on any changes regarding the organizational structure.
Sales department structure: how to divide responsibilities
Learn the following principles to help you create an effective sales department structure, and depending on the number of managers, sales channels, coverage area, choose the one that suits you best.
1. Structure of division by function
Depending on the specifics of the business, the responsibilities of all sellers should be divided into the following directions:
Hunter– those who bring qualified leads to the company, create customer traffic in accordance with your target audience. The role of hunter in the company is played by call center operators, traffic managers, SEO specialists, and sales representatives.
Closer– those who are responsible for converting leads into deals and increasing the average check.
Farmer– those who continue to accompany customers after the first purchase, increasing their life cycle through up-sale (they sell more of the same product) and cross-sale (they sell another product). If you are selling one-time service, then you don’t need farmer managers. IN retail business The role of fermer will be performed by specialists from the marketing department, whose task is to develop loyalty programs.
2. Structure of division by sales channels
You can distribute functions among your salespeople based on sales channels. This is important to do because... business processes are different everywhere. One manager should not work with everyone at the same time; he will not be able to fulfill the plan through any of the channels.
Options for dividing the functions of salespeople by work:
- With dealers;
- With direct clients;
- With retail outlets;
- With tenders;
- With retail chains.
And don’t forget to decide on the priority channels that generate the main income. If your resources are limited, work only with them.
3. Structure of division by target audience
The same manager should not work with large and small clients at once, or deal with radically different areas. For example, a salesperson cannot simultaneously supervise clients in industries wholesale sales fittings and accounting. Change the department structure depending on the size of the buyers or the industry in which they operate.
4. Structure of division by product
Look at the products you offer. Evaluate how the length of the deal differs. Depending on this, managers can engage in sales:
- Expert with a long transaction cycle, require constant consultations. For example, if you are selling an IT solution, a CRM system.
- Transactional with a fast transaction cycle. For example, if you sell software licenses.
5. Structure of division by territorial distribution
It all depends on the geographical distribution of your clients. In each region you must have Sales Representative.
Sales department structure: what should be the control zone
An effective department structure assumes that one manager () should have no more than 6-7 managers directly subordinate to him. Then he will have time to help sellers close deals and will be able to supervise their work for each client.
Under no circumstances should sellers be directly subordinate to the owner. Such cases sometimes happen in retail trade. The owner, due to his status, is not able to manage them effectively. Managers must obey only the EPR.
Sales department structure: how to set employees up for results
Our own experiment has shown that the best results can be achieved when the department structure involves the work of two or more sales departments. Firstly, this will increase the efficiency of the ROP. Secondly, you create competition between the ROPs of the two departments.
With this structure, revenue increases by at least 15-20%. Therefore, if you have 10-15 people working, divide them into two teams, creating two departments.
Sales department structure: how to achieve competition among employees
Everything is fine in your sales department structure if you observe this picture.
1. You clearly understand how the business process works. How sellers achieve results and through what resources.
2. The structure of the sales department employs not 1-2 generalists, but at least 3 closeters who are not involved in either the regular customer base or the ongoing maintenance of the base.
3. You have a head of commercial division who is responsible for operational management.
4. You can fire any employee, and this will not mean the collapse of your sales plan.
5. Employees are engaged in business, not gossip. Plus, they don't blackmail you to get better terms.
6. The owner’s income is always higher than the income of any of the managers and executives. There is even a certain threshold after which employees begin to get carried away. If we talk about Moscow, then for managers it is equal to 120,000 rubles, and for a department head – 200,000 rubles.
To ensure that a similar situation occurs in the company, take measures.
1. You must recruit a team of at least 3 people who will perform the same type of work. So in the event of force majeure, you won’t have a headache about who will replace the “universal” who fell ill at the wrong time, went on vacation, or quit.
2. Operational activities The day-to-day supervision, training and management of the sales team's personnel should be delegated to a professional leader with relevant sales experience.
3. Once you recruit more than 6 employees, you will need to divide them into 2 groups. And put a boss over each one.
4. The business process must be described, adjusted, tested again, recorded in the regulations and transferred to .
5. Once again, carefully analyze the system by which managers receive their remuneration. She should motivate them to achieve results, and not sit idly by. The best help in this matter is complex salary schemes, in which a person, although he receives a fixed payment for his work, but the main income comes from bonuses for fulfilling the plan and performance indicators.
Types of sales department organizational structure
1. Cell structure (division by client base) – assumes that the entire process is closed in one cell, which includes hunter, closer, fermer.
Example: in a certification business, hunter attracts a new client and transfers him to serve him closer and then to fermer. But in complex issues, the farmer again sends the client to closer.
In addition, managers can be divided into groups by territory, products, target audience etc.
Follow the manageability principle: 1 ROP = no more than 6-7 managers. If there are more employees, divide it into several departments with your manager. It is important to create competition between departments and employees so that work proceeds with passion.
Work out a system that will consist of 3 parts. Of these, only one should be fixed, and the other two should be tied to sales plans and key performance indicators.
Create optimal structure enterprise - this means creating an optimal system of structural divisions, an effective system of division of labor among these divisions and a system of coordination of activities. In enterprises with more than 15-20 people, this is a hierarchical system.
Nobody argues anymore that “strategy determines structure” and the optimal organizational structure of an enterprise is the structure that ensures the most effective implementation of the strategy. In turn, the strategy is based on a “tree of goals”, which comes from the socio-economic goal of the enterprise and sets specific goals for all structural divisions.
Thus, if we build a “tree of goals,” then at the same time we will determine the optimal organizational structure of the enterprise.
The basics of creating such a tree are briefly described in the article “The goal of the enterprise and the strategy for achieving it. Conceptual framework". This article provides next levels tree of goals and strategies:
- General goal setting strategy
Socio-economic goals for the near and long term. - General strategy
Socio-economic goals by area of activity.
Balance of production, research, development and other possible directions. - Subject strategy (defining subjects of activity)
- Technical strategy (definition of each activity)
- Production and implementation (implementation) of each item of activity - tactics
Strategy and structure are built from the top down. Original target– these, as noted, are socio-economic goals for the near and long term. And these are the goals of the owner and manager of the enterprise. Based on which, the head of the enterprise must determine socio-economic goals for areas of activity, and, of course, first determine these areas. It is clear that they can be defined in different ways, depending on competencies and personal attachments.
What areas of activity can a manager set? These are, firstly, managerial and auxiliary (accounting, administration, IT, planning and dispatch, etc.), we will not dwell on them here, although it is clear that they have their own private goals and their own organizational structure.
One of the options for top-level goals (top managers) is, for example, identifying market requirements, developing new competitive products, producing them at low costs, selling products, and accordingly, a linear organizational structure is created with the formation of structural divisions based on functional characteristics (Fig. 1, these divisions are highlighted in yellow in all figures).
Picture 1. Linear organizational structure with the formation of structural divisions based on functional characteristics
Target: minimum production cost
Policies for achieving the goal: specialization, division of labor
Organizational structure: linear functional organizational structure
Possible problems: insufficient quality of products, difficulty in motivating the final result of the enterprise
However, we immediately note that marketing, development, production, and sales themselves are not goals, they are functions. The purpose of, for example, the development department is projects on new products- development of documentation for products, and not just documentation, documentation for products that will be consumed in given volumes during a given period life cycle products and bring the enterprise the desired final socio-economic effect. And the achievement of the development department’s goal is assessed precisely by the effect obtained from each project, and not by the number of man-hours spent on the project or the number of documentation formats released. If such a goal is formulated, and its achievement is monitored and evaluated, then the unit will work effectively and will coordinate its activities with other units that influence the final result. This is the only way to allocate the required resources to each department and obtain an effective structure.
In the case of a linear organizational structure with the formation of divisions according to functional characteristics, the marked divisions work according to the principle of a conveyor, but, unlike the strictly regulated conveyor of an assembly shop, when transferring intermediate results between divisions, numerous inconsistencies arise, and it is not clear who is responsible for the final result. With such goal setting, the head of the enterprise must have sufficient competencies to resolve issues between marketing, developers, production and sales.
Another strategy option is, for example, highlighting the goals of creating and releasing one product, creating and releasing a second product, etc. products and, accordingly, a linear organizational structure is formed with the formation of complex structural divisions according to product characteristics (Fig. 2), complex divisions are highlighted in green in all figures. In this case, the head of the enterprise no longer interferes in settling issues of development, production and sales; each division is fully responsible for its product - the end result of both the division and the enterprise as a whole, which improves the quality of the product. However, there is duplication of functions and high production costs.
Figure 2. Linear organizational structure with the formation of structural divisions based on product characteristics
Target: High quality products
Policies for achieving the goal: universalization (the opposite of specialization), confining the entire range of work for each product (group of related products) in one department
Organizational structure: linear product organizational structure
Possible problems: high production costs
Similarly, structures with complex territorial divisions, divisions focused on different consumers, etc. can be created.
To ensure a reduction in duplication of functions, both complex and functional divisions are created at the top level, the latter working on all products under the dual control of the complex division (horizontal connections) and the head of the enterprise (Fig. 3). This is a matrix organizational structure. In this structure, a comprehensive division leads the creation, release and sale of its product through all functional divisions and is fully responsible for it.
Figure 3. Matrix organizational structure with production (product) and functional divisions
Figure 4 shows another type of matrix structure, where complex units operate under dual control: the head of the enterprise and functional units.
Figure 4. Matrix organizational structure with production (restaurants) and functional divisions
Target: Optimal price-quality ratio of products
Policies for achieving the goal: joint specialization and universalization
Organizational structure: matrix organizational structure
Possible problems: complexity of organizing dual control
Thus, firstly, we must determine the enterprise strategy, what goals and how we will set the divisions at the top level, and at the same time decide which divisions we should form.
Having decided on the structure of the top-level divisions of the enterprise, we can move on to the structure of each of these divisions. It is not difficult to understand that this is done in exactly the same way. For example, in a top-level division of an enterprise, the goal of which is the creation and sale of products 1 and 4, we can distinguish the private goals of development, production, sales and the corresponding divisions of the second level of the hierarchy. For products 2 and 3 (for example, these are software products) all work is carried out in one department.
Figure 5. Linear organizational structure with the formation of structural divisions based on product characteristics with a disclosed second level of hierarchy
The development of strategy and structure begins from the top level and proceeds, according to this scheme, to the lowest level of the hierarchy, to each ordinary employee. This is described in detail in the article “Development effective strategy and enterprise structures - a practical step-by-step methodology."
The most difficult is the upper level of structural divisions, when from general social and strategic goals substantive goals are formed for specific products, specific projects in the internal and external environment. There can be no formal rules here. And if you form structural units Without setting specific goals, then effective management is almost impossible, because any management is management to achieve a set goal.
When the subject goals are defined, then at the lower levels the question is much simpler - the decomposition of the “subject” into its components and the goals for creating these components are already quite clear.
Let us also note the issue of adaptability to change environment, largely solved by delegation of authority and decentralization. If in the linear product structure Fig. Give 2 product divisions significant powers for goal setting: determining products, output volumes, creating a budget and disposing of it, etc. (within certain limits), then it will be a divisional structure of structural units that independently and promptly solve emerging problems with external environment without unnecessary bureaucracy. If the matrix organizational structure Fig. If 4 restaurants are given significant powers, then it will already be a network of relatively independent restaurants.
Target: high adaptation to changes in the external environment
Policies for achieving the goal: delegation of powers, decentralization
Organizational structure: divisional organizational structure, network organizational structures
Possible problems: the possibility of the goals of decentralized units dominating over the goals of the enterprise, reducing controllability
Thus, by setting specific goals in accordance with the general goal of the enterprise and forming structural divisions for them, we obtain the optimal organizational structure of the enterprise to achieve the goal and the strategy for achieving it, built according to the developed tree of goals.
Bibliography
1. Zhemchugov A.M., Zhemchugov M.K. // Official publication of the International Research Institute for Management Problems International magazine“Problems of management theory and practice” No. 5, 2014 p. 75-80.
2. Zhemchugov A.M., Zhemchugov M.K. Development of an effective strategy and structure of an enterprise - a practical step-by-step methodology // Problems of economics and management No. 6, 2013, p. 15-21.
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