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Presentation By: Rajan Sharma Getting Started for Export to European Union First session: Managing the organization. Beginning of the Beginning Objectives Understanding the Global Context Kinds of organization. Understanding the Features of SME Understanding the Economy Sectors. Sector of Economy Features of Corporate Culture Turning information into value (L)earning for a living (… continuous performance improvement …) Turning information into knowledge Turning knowledge into value Knowledge without action is meaningless Action without knowledge is dangerous Superficial knowledge is risky Dimensions of the corporate environment that influence the function in a SME exporting firm. Corporate culture, mission, goals & policies Type of Organization Function of SME objectives, policies, processes, culture & structure Corporate functions, processes & structure Corporate strategy Overcoming Barriers Many successful multinational companies have undertaken a strategy of: THINKING GLOBAL, ACTING LOCAL!! The importance of SME s... represent more than half of GDP and half of employment worldwide Advantages of Quick reactions Close supervision & control SMEs Low overhead costs Reduced taxes, special credit Disadvantages of SMEs Vulnerable due to limited product range Depend on their leaders SME Constraints of SME s No IT support P&S function not well developed SME Shortage of working capital influences size & timing of orders Limited P&S knowledge and skills Advantages of Multinationals Many customers & well known More diversified Greater access to finance Qualified staff Information systems Multinationals Leverage due to high volumes & reputation P&S strategies & policies IT support systems Optimal order quantities Well developed P&S function Specialist P&S staff Key differences amongst different types of organizations Feature Private Public Non-profit Control Individuals and other enterprises Government Individuals and organisations Funding Shareholders and accumulated profit Taxation, grants, public debt and fees for services Sponsors (grants, donations), members and fees for services Typically, to optimise profit Typically, the effective A belief, value, ideology or service to and efficient provision of be provided public services Prime goal Accountability To shareholders Competition Typically yes To the public To sponsors or members Typically no Generally not relevant The law (in general) The law (in general) Constraints Any self-imposed constraints Laws, regulations and procedures applicable to the public sector The law (in general) Changes in government policy / politics Any self-imposed constraints Major sponsors may impose constraints Corporate Culture Comprises values, beliefs and norms. Subconscious level Has an impact on: Corporate goals and policies Corporate Culture Organizational structure Internal and external channels of communication Control systems Reward systems Working hours Dress requirements, and Social relations. What determines corporate culture? (I) the national culture: •Importance of personal relationships •Protocol vs. familiarity •Concept of time & punctuality •Degree of directness •Attitude to risk & risk-taking •Importance of continuity vs. innovation & change •Attitude to confrontation & disagreement •Attitude to short vs. long term What determines corporate culture? (II) #The founder and dominant individuals Bad experiences the organization past will discourage #history of inthe certain approaches in the future. #age & size #nature of the work #the types of power….. Main features of the different types of corporate culture Main source of power Nature of control and Dec.-making Where is it appropriate? Disadvantages Power Culture Power by influence Suitable individual Task Culture Power by position In the hierarchy Power by expertise & capacity to bring people together Leaders’ orders Rules & procedures and commands Fast changing environments Small companies Vulnerable if key staff lack competence or leave Risk of in-fighting Individualist/ collectivist? Role Culture Individualist Ambitious / power oriented Project managers & project groups Stable environment with routine tasks Significant inertia to change Collectivist One who values security and predictability Expert power Individuals Project environments Partnerships of professionals Can fail if people don’t work well together Can be difficult to control Where quality is critical Stifles creativity Independency Culture Collectivist Individualist Team-worker Self-motivated Thank you for your Attention: Any Questions??? Second Class: A step forward for Export to Europe By: Rajan Sharma: Managing the Organization Where are you going? Vision, Mission, Goals, Strategy and Policy. Environmental, Ethical and Employee issues Organizations that participate in International Transaction. How to enter a Market. Operating cost efficiently. Where are you going?? Vision Mission Goals Strategy Policies It is good practice for an organization to publish its vision, mission, goals and policies Vision, Mission, Goals…. Vision focuses on the long term, i.e., where the organization aspires to be in the future. Vision is broad & general. Mission represents what the company considers its basic role to be. Mission is more concrete. Goals are aligned with the mission & are more specific. Strategy is the way of achieving the goals. Policies define the principles and guidelines to be complied with. Vision, Mission, Goals… (examples) Vision: To become the leading manufacturer of hand tools in our country market. Mission: To provide the widest range of hand tools for home use in our country. Goals: To reach a turnover of $10m within 2 years. Strategy: - Launch three new hand tools over the next year. - Intensive training of our sales staff. - Development of strategic partnerships with suppliers of key inputs. Policies: - Minimize waste and avoid the use of unnecessary packaging. - Offer a good working environment and working conditions….. Environmental policies Energy conservation Avoiding the use of ozone-depleting and other harmful substances Minimizing waste / avoiding the use of unnecessary packaging Recycling, and making use of recycling materials Minimizing dependence on non-renewable sources Minimizing stock (and the associated wastage through obsolescence). M1:U3:3.4-2 Ethics policy Contains principles and rules of conduct May cover: Code of ethics Conflicts of interest Bribes & other forms of corruption Gifts and hospitality Respect for confidentiality of information Fair and transparent dealings with suppliers and customers Not to deal with enterprises that exploit forced labor, poor working conditions, inadequate health and safety, intimidation of workers defending their rights... Employee welfare policy Guarantees of employment Good regard for employee health and safety A good working environment and working conditions Provision of medical care Greater than the statutory requirement for maternity and sick leave Compassionate leave Non-discrimination on the grounds of disability, race, sex, age, rehabilitated offenders How competitive are your firm’s products or services? Quality Availability Customer service & responsiveness Low cost Benefits customers seek Regularly obtain feedback from actual or potential customers. CRM as part of organization development Tool to learn more about customer needs to customize services and enhance added value to increase customer satisfaction and customer loyalty TQM/ISO • How can our supply chain respond to implications of alternative modes of entry? • If it cannot currently respond, what must be done? • How to manage the supply chain in the event of a business collaboration arrangement (e.g., centralise or keep separate)? • Which functions will our firm undertake, and which will it source externally? • Which will be their objectives, priorities, policies and strategies? • What will be the relationships amongst its functions and its processes? • What structure will it adopt? Scope of activities of SME Developing supply strategies Negotiating Specifying requirements & planning supply Preparing the contract Appraising & short listing suppliers Analysing supply markets Obtaining & selecting offers Managing inbound logistics Managing inventory Managing the contract & supplier relation- ships In small enterprises, one person undertakes a number of functions Major Participants in International Business Transactions Domestic Bank Domestic Government Agencies Domestic Seller Export Facilitator Inland Transportation Carrier Domestic Port/Terminal of Exit International Carrier Foreign Port/Terminal of Entry Foreign Government Agencies Foreign Bank Foreign Inland Transportation Carrier Foreign Buyer QUALITY WITH ZERO TOLERANCE A MENTALITY OF CONTINUOUSLY STRIVING FOR PERFECTION Never be completely satisfied with what you do, how you do it and how efficiently it has to be done. Please realize that there is always room for improvement and when you miss the opportunities for improvement while your competitor turns them into competitive advantages, you will be outsmarted & outranked on the international markets Thank You for your attention. Any Questions ??????