Download Study on Operation Mechanism of Enterprise Post Monetization Management

Study on Operation Mechanism of Enterprise Post Monetization
Management
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XIANG Laisheng , LIU Zhongwen
School of Business Administration, Dongbei University, Shenyang Liaoning, P.R.China,110004;
School of Economic and Management, Shandong University of Science and Technology, Qingdao,
P.R.China,266510
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Abstract Enterprise’s post monetization management is one of the important achievements of business
management innovation. The paper defined the meaning of enterprise post monetization management
mechanism, which include benefit, supply, demand, competition and incentive mechanism, and
specifically explained the meaning and function of each subsystem in order to profoundly crystallize and
grasp the importance of enterprise post monetization management in the aspect of raising business
management level.
Key words Internal marketization post monetization operation mechanism business management
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1 Introduction
Any system’s movement has its own intrinsic mechanism, and so does the post monetary
management, which can be defined as a kind of intrinsic mechanism that describes the interrelation,
interdependence and the interaction of all the essentials or parts of a system and the comprehensive
function and movement development of their combinations in the certain economical movement process.
The operation mechanism of enterprise post monetary management is intrinsic mechanism of the
enterprise post monetization management. This paper discusses the post monetization management on
the condition of internal marketization of enterprise.
2 The Motion Mechanism of Enterprise Post Monetization Management: Benefit
Mechanism
In the post monetization management of enterprise, teams or posts is one of main bodies of internal
market. The intrinsic power mechanism is necessary in order to make the terms or posts act as the
important role of the internal market operation and fully exert their subjective initiative. In other words,
each team or post must have explicit definition of property rights and independent economic benefits,
and whose production and exchange behaviors were controlled by its independent economic benefits.
Meanwhile, each post adjusts its behavior according to the change of internal market under the control
of its own benefits and the change of internal market determines the fluctuation of each post’s profits.
For example, when the post arranges its own management according to the need of internal market, and
tries its best to save the labor expenditure according to the request of price of internal market, the higher
profits be obtained; otherwise, the lower profits, and even get loss. It must be acknowledged that market
profits also are the goal of the posts so as to make each team or post work revolving around the internal
market and arrange its management according to internal market conditions under the function of profit
law of the internal market.
When certain merchandise in internal market falls short of demand and can bring more profits to
the team or post, this post can be able to retained and the funds and labor will also flow into the team or
post which produces this kind of merchandise under the control of own benefits and vice versa.
3 Intrinsic Adjustment Mechanism of Enterprise Post Monetization Management:
Supply and Demand Mechanism
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Supply and demand mechanism is the essential and core of market mechanism, which refers to the
organic connection between the supply and demand of market and the market price and their movement.
As for the post monetization management, the supply and demand of post and the benefits of staff are
interrelated and restricted with each other. The change of supply and demand of internal market affects
the price of internal market, and transmits the bi-directional information of supply and demand of
internal market by the price. Furthermore, the change of supply and demand of post affects the staff
benefits, and transmits the bi-directional information of supply and demand of internal post of enterprise
through the change of staff benefits, which plays a vital role for the post setup and the allocation of
resources and human resources. In short, in the operation process of post monetization management, the
function of supply and demand mechanism is all-round, and having different function in the different
function level.
First, the supply and demand mechanism is the competition motion for the staff of same post.
Generally speaking, for the same post, under the similar condition of working condition, wage level,
welfare and so on, the higher the staff benefits is, the more staffs participate in the post competition, and
the staff must enhance their competitive ability by strengthening their own quality so as to get a better
post; on the contrary, the consumption should be reduced, the techniques should be improved, the using
efficiency of the machine equipment should be improved, and the fixed number of staffs for certain post
should be cut down if the staff want to gain higher benefits, and which will inevitably promote the
economy of labor and resources of the entire enterprise and even the entire society.
Second, the supply and demand mechanism is the signal of adjusting the direction and scale of
production for the staff of different post. In the process of post monetization management, the change of
supply and demand of post affects the staff benefits, but yet the change of staff benefits will also act on
the setup of post. When the demand quantity of merchandise which produced by the certain post
increases in internal market, the short-term reflection of the staff of the post is to raise the price of
merchandise so as to increase the aggregate benefits of the post. If the supply of the merchandise still
falls short of its demand, the staff of the post will expand the production scale of the merchandise and
increase its supply in the internal market, and the post will attract competitive bidding of much more
people. At the same time, as for the posts whose merchandise only provides a little profits or no profits,
it will inevitably turn to produce the merchandise that can bring more profits under the stimulation of
the signal, and the enterprise will also reduce the quantity and scale of this post, and transfer the funds
and labor to the production of merchandise whose supply falls short of demand. In this way, the supply
and demand mechanism can regulate the allocation proportion of the internal resources of enterprise
among units, teams, and posts, and finally reasonably and effectively collocating resources according to
the demand.
Third, the supply and demand mechanism is the signal to change the direction, scale, and structure
of demand for the consumer. According to general rule of demand, the less the supply (supply falls short
of demand), the higher the price of merchandise, and the smaller the demand of consumer in the short
run or under the condition of certain consumption level,; conversely, the more the supply (supply
exceeds demand), the lower the price of merchandise, and the larger the demand of consumer. Therefore,
the change of the supply and demand of the merchandise can cause the rise and drop of the price of
merchandise, thus act on the purchasing power of the consumers, and then affect the demand scale and
purchase quantity of the consumers. Moreover, when there are substitutions, in view of the rise of price
of a certain merchandise, the consumers will substitute other merchandise, which means giving up
purchasing the merchandise and turn to others that has the similar capability or can achieve partial
function of the merchandise with lower price, thus cause the change of direction and structure of
demand of the market.
In the process of post monetization management, the function is similar of supply and demand
mechanism. In the short run, when the post’s supply falls short of its demand, which means the people
engaged in this kind of work exceeds the demand, the post income will be reduced, and the number of
people participating in competitive bidding for the post will accordingly decrease; Contrarily, when the
post’s supply exceeds its demand, the income will be raised, and then the number of people participating
in the competitive bidding for the post will also increased. Therefore, the change of supply and demand
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of the post brings out the change of post benefits, thus affects the demand of people participating in
competitive bidding for the post (including scale and quantity). Similarly, when other post needs similar
technology and skill with the post but with higher benefits, the demand of the post will turn to the
substitution one, and thus cause the change of post setup namely post structure inside the enterprise.
Fourth, the supply and demand mechanism is an important means of enterprise’s “macro-control”. The
changes brought by the changes of internal market’s supply and demand not only can regulate the
allocation of resources, but also can provide information of enterprise to carry out “macro-control”.
Especially for those posts that are not able to be in balance by the supply and demand of internal market,
the enterprises will intervene the operation of the post monetization management according to the
information provided by the internal market. Generally speaking, when there are far more people
participating in competitive bidding for certain post, it indicates that the post can provide higher returns,
and the supply and demand gap of the merchandise produced by the post is relatively large, and much
more people participating in such kind of work also be needed. According to this information, the
enterprise can encourage and expand the scale of the post staff so as to expand the production of the
merchandise and increase its supply; contrarily, reduce and restrict the production of the merchandise,
decrease the staff scale of the post, thus precipitate the balance of the aggregate supply and demand.
This not only can reduce the loss caused by the failure of internal market, effectively induce the balance
between the supply and demand of internal market, but also can far more rationally allocate resources of
the enterprise.
4 Survival of the Fittest in Enterprise Post Monetization Management:
Competitive System
Survival of the fittest is the essential characteristic and inevitable result of competition. Full and
effective post competition is the prominent characteristic and main content of the post monetization
management.
First, the post competition can ensure the main bodies of the operation of the post monetization
management, post staffs, have intrinsic motivation and external pressure and only those employees who
win in the competition can obtain the economic benefits, and the losers will be laid off. Therefore,
competition will make the enterprise employees feel a sense of urgency and pressure, which will urge
them to play their full initiative, creativity and adventurous spirit, thereby mobilizing the vitality and
vigor of the enterprise.
Second, the competition in the post monetization management has the function of pricing. The
personnel’s competition to posts has great impact on the posts. On one hand, the competition among
posts brings higher post settlement price; on the other hand, the personnel’s competition to posts causes
the decrease of post settlement price. Therefore, it can be say that competition affects pricing, and
whose degree is determined by the power comparison of kinds of competition parties.
Third, the competition can ensure the exertion of self-regulating function of the supply and demand
mechanism. Concretely speaking, the supply and demand mechanism can promote allocation of
resources through the price (the staff benefits) based on the premise of the existence of effective internal
market and effective post monetization management in the enterprise, and through the competition, the
resources, funds and personnel will flow automatically to the places where they are needed most by the
enterprise.
Fourth, the competition regulates the supply and demand tends to be balance. Generally speaking,
the supply is in direct ratio with the market price, the demand is in inverse ratio with the market price,
and the supply always floods to the places of high price, while the demand to low price under the
conditions of market economy. When supply exceeds demand, a buyer's market comes into being, and
the sellers compete with each other, which will force the price to descend, stimulating demand on the
one hand and restraining supply on the other hand, thus enabling the supply and demand up to balance
spontaneously. When demand exceeds supply, a seller's market comes into being, and the buyers
compete with each other, stimulating supply on the one hand and restraining demand on the other hand,
thus enabling the supply and demand up to balance spontaneously too. In the process of post
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monetization management, the competition is also playing the similar role. When supply exceeds
demand, there will be less people participating in competitive bidding for the same post, post vacancies
will appear, and then the settlement price of post will be upgraded, working conditions will be
appropriately improved, the competitive bidding standards will be decreased so as to attract suitable
candidates; Conversely, when demand exceeds supply, there will be much more people participating in
competitive bidding for the same post, and then the most suitable person can be found much more easier
by the enterprise, and the settlement price of post can be appropriately decreased and the competitive
bidding standards should be heightened in order to restrain the demand. In short, whether supply
exceeding demand or falling short of demand, the supply and demand will be up to balance
spontaneously through the competition.
Fifth, the competition can regulate the balance of units, teams or posts in the enterprise. In the post
monetization management, when rate of profit of certain team or post is too high, it indicates there is
still great market potential of supply of the post and more resources should be absorbed.; if the rate of
profit of certain team or post is too low, which indicates that supply of the team or post is already
saturated or excessive, and the enterprise should withdraw part of resources from the team or post. The
competition among units, teams or posts of the enterprise will cause the funds and labor forces flow
among different rate of profit, which is in fact the exit and absorption of resources among unbalanced
units, teams or posts inside the enterprise, by which, the allocation of enterprise resources can be up to
balance, and the most profits can be brought out.
Sixth, the full and effective competition brought by the post monetization management can ensure
the improvement of welfare of the enterprise staffs, and enables the enterprise to manufacture the
production that meet the need of society with lower cost. As for competition, it can be divided into price
and non-price competition in terms of the means and mode. Under the post monetization management,
the price competition is one that relies on the decrease or increase of staff income to compete, which can
be fully appeared on the condition of the enterprise are not restricted by price. However, such condition
is almost inexistent in internal market of enterprise. As a matter of fact, the confirmation of internal
price is often fixed by certain regulation on the one hand, and on the other hand, the talents the
enterprise needed always with “heterogeneity”, which means the quality of each people is different.
Thus, simple price competition cannot achieve the objectives, and non-price competition, which refers
to that the enterprise relies on the quality of the talents to reduce production cost, improve production
efficiency and thus wins the competition in the market should be carried out, and it is the very root of
victory of the enterprise.
5 Diversified Distribution Method of Enterprise Post Monetization Management:
Incentive Mechanism
Ever since a long time ago, the distribution according to contribution is considered as principle for
the distribution of enterprise income, which practically proved has a certain positive effect on improving
the initiative of the staffs, but cannot achieve optimal allocation of production factors and the reasonable
flow of human resources, capital and other production factors within the enterprise. It is indicated in the
Report of 16th Party Congress that the he principle of distribution according to contributions for the
production factors such as labor, capital, technology and management should be established, the system
in which distribution according to contribution is dominant and a variety of modes of distribution
coexist should be improved. Through internal post monetization, the enterprise can link the economic
dealings among main bodies of market by the price settlement, determine the degree of income by the
price settlement, and obtain assets proceeds through competitive bidding for shares as well. The new
benefits distribution mechanism fatherly mobilized the initiative of the majority of employees, improved
the management consciousness, work quality, and optimized the constraints and incentive mechanisms
of the enterprise.
In the past, the contract system was often adopted of enterprise to manage its underling units, under
which, the nation owned the property and the managers were responsible for the management, the
short-term behaviors of the managers caused considerable loss of state-owned property, which is
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actually only paid attention to the incentive and ignoring the constraints. Through implementing the post
monetization management, the definition of property rights turned to be more clearly, while poor
management performance meant no returns and the loss of personal assets. Furthermore, the enterprise
achieved the uniform of internal asset ownership and the using right, improved the internal control and
incentive mechanisms, and achieved the effective management of " the user is the owner, the beneficiary
is the owner", which made the basal management of the enterprise turn from passive to active, and
actually achieved self-control, self-discipline and self-motivation, and mobilization of staff initiative.
Post monetization management is one of the most important achievements of business management
innovation, thus, to research and discuss its operation mechanism is very significance of improving the
enterprises’ management level. Only accurately master the internal mechanism of the operation of
enterprise post monetization management, the function of the post monetization management can be
effectively brought into bear. We should take actions that suit local circumstances and give judicious
guidance according to circumstances in accordance with the internal mechanisms and its operation
discipline so as to urge the post monetization management make greater contribution to the business
management reform.
References
[1] Liu Zhongwen, Liu Juan. The discussion of post monetization management of coal enterprises. Coal
Economic Research, 2005, (11):62-64 (in Chinese)
[2] Liu Juan. Reasearch on the mode of post monetization management of coal-enterprieses, master
disseration of Shandong sicence and technology university, 2006(in Chinese)
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The author can be contacted from e-mail
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