management organisation exam
MANAGEMENT OF SMALL AND MEDIUM – SIZED ENTERPRISES II
Prof. Tadeusz Oleksyn, maj 2020
MANAGEMENT OF SMEs IN GREAT BRITAIN; CULTURAL CONDITIONS
Great Britain initiated (in 18th century) industrial revolution. Hovewer after World War II its economy and management has lost its position among global leaders. Now Great Britain is economically behind too the US, China, Japan and Germany. Of course, the fifth place of GB in the world in term of GDP is still high. There are dozens of countries with a much larger populations than GB - with significantly lower GDP. The City of London is one of the world’s financial leaders.
The list of 10 countries with the highest gross domestic product is as follows (in billion $:
(1) US 19.485; (2) China 11.191; (3) Japan 4.872; (4) Germany 3.693; (5) Great Britain 2.626;
(6) France 2.583; (7) India 2.576; (8) Italy 1.944; (9) Brasil 1.793; (10) South Korea 1.531.
Source: Rocznik Statystyczny GUS 2019 tab. 688 p. 882 (date for 2017)
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MANAGEMENT OF SMEs IN GREAT BRITAIN (2) RANKING OF MATERIAL WELL – BEING OF CITIZENS
The list of 10 countries with the highest gross domestic product per capita (in $) is as
follow („world extra - league” material well – being of citizens):
(1) Luksemburg 104,535; (2) Switzerland 80,342; (3) Norway 75,704; (4) Ireland 69,015
(5) US 59,774; (6) Australia 57,269; (7) Denmark 56,452; (8) Sveden 53,170;
(9) The Netherlands 48,495; (10) Austria 47,394
There are the countries with the highest welfare rate too (highest prosperity).
On this list there are no Germany, Great Britain, France, Canada and other wealthy countries.
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MANAGEMENT OF SMEs IN GREAT BRITAIN (3)
Entrepreneurs and managers haven’t the highest position in British socjety. Above them are outstanding humanists, media people, and aristocracy.
Middle - aged and older entrepreneurs and managers have not been well educated; only 35 % of them have university education. In SMEs sector this indicator is even lower.
The number of entities from SMEs sector in GB is relatively large and amount to 5,3 milion. SMEs account for 99 % of all enterprises. As everywhere, the numer of one – man firms is very large and amounts to 2,5 milion.
The SMEs sector provides 60% of the employed and gives 50% of GDP – just like in Poland.
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MANAGEMENT OF SMEs IN GREAT BRITAIN (4)
The United Kingdoms is a multicultural society. There is a significant number of immigrants, most of who, however, accept and adopt the dominant management style and concepts and assimilate into society. 62 milion people from different nationalities live here.
British managers are carefully watching new employees. They don’t say much, don’t assess or comment. New employees , not knowing their habits, may get the impression, that they can work less. This is a big mistake, bacause their bosses are shapping own opinion at that time. If their opinion will be positive, they will put a great trust in the new man and they will have good prospects in their organizations. If it is bad, it will be very difficult to change bad opinions later. The employee’s position will be weak or even threatened.
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MANAGEMENT OF SMEs IN GREAT BRITAIN (5)
A characteristic feature of GB is starting very young people in business – often before the age of 18. In many other countries this would be impossible for legal reasons: an underage person would not manage the company and would not be allowed to run the business.
Already in the 1980s inGB very young people aged16 – 17 left school and immediately tried their hand at business, initially on a small scale. Many of them later became very successful in business. Examples are Alan Sugar – the founder of the Armstrad computer company, Richard Bransom – founder of the Vergin airline, Anita Roddick – founder of a network of cosmetics stores. These people became famous and rich. [T. Gruszecki, Przedsiębiorca / Entrepreneur, Cedor s. 41-42
A quick start in the business of young people is also taking place on a large scale in the US, Germany and many other countries.
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MANAGEMENT OF SMEs IN FRANCE – R. Cantillon and his entrepreneur
The terms entrepreneur and entrepreneurship were created by the French economist and entrepreneur Richard Cantillon (1755). He used them 20 years before Adam Smith, the father of modern economy.
Cantillon initially associated term entrepreneurship with trade. He was the first to pay attention to the risk connected with the entrepreneur’s activities. Goal of trade it’s to buy cheapper and to sell expensively. Sometimes, however, this fails.
Cantillon was the progenitor of the classical entrepreneur who had three characteristics:
- he was the founder of the enterprise;
- personally manager it;
- personally took all financial risk.
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MANAGEMENT OF SMEs IN FRANCE – R. Cantillon and his entrepreneur (2)
Classical eterpreneur is today only in the SMEs sector.
In the cases of big and very big enterprises the others people founded companies and
the others manage them.
Large companies are usually manage by professional managers, no by their owners.
Financial risk is spread over many people. Especially, in a join – stock company, financial
risk is spread over many sharehoulders. Sometimes the numer of shareholders is
thousands and even tens of thousands.
Nevertheless, the classic entrepreneur is still the favorite hero of economic theory.
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MANAGEMENT OF SMEs IN FRANCE – strengths and weaknesses
In France, SMEs account for 99% of all enterprises. The situation of SMEs in France is seen as paradoxical: they are as strong, vital, as they are weak, delicate.
Advantages of this sector in France are the next: high flexibility in adapting to the changing maket, vitality, creativity, significant growth of potential, generating most jobs in the economy.
On the other hand, there are several impediments, weakness: difficulty in obtaining loans, high interest rates, heavy dependence on clients and supliers.
There are 2,5 milion of heads of SMEs. They account untill 11 % of all people working in France. Their commonly use the help of families – also in sole proprietorships.
Among people heading SMEs 33% are over 50 years old. Untill 70% of entrepreneurs there are the men with vocational education.
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MANAGEMENT OF SMEs IN FRANCE – SUPPORT
Like all countries, France also supports the development of the SME sector. The priorities are as fellows:
- improving the level of education of enterpreneurs, especially in the areas of law (incuding taxes), finance, IT, communication, strategy and development shaping, soft competencies, time management and sef – management;
access to funds, supporting entrepreneurs;
simplifying formalities – with respect toestablishing firm and operating an enterprise;
cutting red type (increassing of bureaucracy); France is a highly centralized, bureaucratic country with a large numer of officials – so it isn’t an easy task.
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MANAGEMENT OF SMEs IN FRANCE culture is the most important
Power is not a goal in itself but rather a means to propagating culture. In other words, the most important thing is promote their own culture – in the country as well as in concrete organization.
Freedom, equality and brotherhoods (liberté, égalité, fraternité) are within individual states or groups of positions. For example, these values are within managers of second level or within of specjalists. On the other hand there is a distance and hierarchy between different groups of employees – for example, there is distance between second level managers and third level managers. These relations may be not nice.
Foreigners on the whole can more easier integrate with the English than with the French.
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MANAGEMENT OF SMEs IN FRANCE – the importance of tradition
Like every country with a long and rich culture and history, France has a strong identity. The French think they are special – and in a way it’s true.
Very specific – and rare – is belief that the past is more important than present or even future.
The French are proud of their history, high culture and many unquestionable achievement.
The history of families, outstanding entrepreneurs, managers, companies and business is
also valued.
Attachment to radition is also a limiting factor. In France, especially in the provinces, the influenceof the same families has been strong for decade or even centuries. They often have noble or aristocratic roots and decide everything – local politics, economy, ect. This had its bad side.
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MANAGEMENT OF SMEs IN FRANCE – synthesis and system D
The French have two characteristic features – among many others – which will be shown here: ability to synthesize and passion for dancing at the edge of the law. Both of this features are also manifested by entrepreneurs, regardless of the size of their companies.
The ability to make accurate synthesis is very usefull in businesss – especially in forecasting and strategy selection. The French are often giftedin this direction. It draws the attention of many researches and experts – including Hampden – Turner, Mintzberg, Trompenaars. Domain of Americans (US), Englishmen, Danes and Dutch is mainly analysis.
Dancing at the edge of the law it’s to bend the law at the border of breaking it – but without a crime. The French percive this as fexibility, as a proof of inteligence and call it „D system” (débrouiller, in English unravel , in Polish rozwikłanie, in Russian rasputywanije, in Ukrainien rozłuczennia).
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MANAGEMENT OF SMEs IN FRANCE - LIFESTYLE
France is a highly centralized , biurocratic country with a large numer of officials.
Organizational hierarchy is partly mitygated by familiar relationships – especially in small firms. Paternalism is guite common in family business – and this is is tha majority in the SME sector. However, interpresonal relationships are natural and generally good.
The French, specially the French bosses, are often eloquent. They like to impress others with their comments, sophisticated conversation, savoir – vivre, elegance and manners.
The French often focus on „tasting life” and making an impression. They don’t just live to work only.
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MANAGEMENT OF SMEs IN SVEDEN – QUALITY AND INNOWATIOS
Sweden has a territory of 450,000 sq. km and a population of 9,5 milion. There are 662,000 registered SMEs. Taking into account the country’s popolation, the numer of firms is proportionally greater, than in Poland.
The Swedish market is full affluent and demanding consumers. Thus high quality of goods and services is a must. Since several years Sweden has been the leader of the Innovation Union Scoreboard. This ranking shows the achievement of innovators from different countries.* People from small and medium - sized enterprises had the greatest impact on this.
Swedish companies are generally very modern, innowative and competetive even on the background of a highly developed European Union.
* Szwecja najbardziej innowacyjna w UE. „Szwecja dzisiaj”, 29 May 2018
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