3.2 Application of situational management approach

The situational approach ^* expanded the practical application of system theory by defining the main internal and external variables that affect organizations. The central concept of the situational approach is the situation.

A situation is a specific set of circumstances that decisively affect an organization at a particular time.

The situational approach is the orientation of management within the enterprise to a set of variables of the nature of the impact that characterize a particular situation.

The organization and methods of management are constructed in accordance with the situation in which the enterprise or institution is currently located. The situation is changing - the management methods and the behavior of the decision-maker are changing . Thus, unlike all previous methods of managing collective actions, the management includes a constant update with a focus on a specific situation. And in the set of effective management tools, the ability of “situational thinking” is added to “system thinking”. The concept of the management process, focused on the situational approach ^* , is applicable to all organizations, because the situational approach tries to link specific principles and methods of work with certain situations in order to achieve the goals of the organization most effectively. In addition, each situation ^{* is} considered so as to determine its unique properties before making a management decision ^* . This significantly distinguishes it from the previously used approaches focused on universal principles, which were often not applicable to specific situations. The situational approach ^* concentrates on situational differences between organizations and within organizations themselves. The implementation of the situational approach assumes that the manager must:

1. be able to analyze the situation from the point of view of what requirements the organization has for the situation and what is characteristic of it;
2. make an appropriate decision that would best and best meet the requirements put forward to organizations by the situation;
3. be able to anticipate the likely consequences, both positive and negative, of the application of a particular method or concept;
4. to create in the organization the potential and necessary flexibility in order to be able to move to a new managerial style corresponding to the situation.

With the help of the situational approach, the manager tries to determine what are the significant variables of the situation and how they affect the effectiveness of the organization. All factors of influence can be grouped into two main classes: internal and external variables.

Internal variables are situational factors within an organization that are essentially the result of management decisions. The main internal variables include goals, structure, labor, equipment, inventories, technology and organizational culture ^* .

In the analysis of external variables are usually distinguished:

• variables of direct impact , i.e., those that directly affect the operations of the organization and are directly affected by the operations of the organization (suppliers, laws and government agencies, consumers, competitors and owners);
• variables of indirect impact , that is, those that indirectly, rather than directly affect the operations of the organization and do not experience the direct influence of the operations of the organization (economic environment and political environment, technological, socio-cultural and international environment).

A “business situation” is a list of events and problems actually facing a decision maker with a focus on internal and environmental information . Changes in external and internal variables indicate the emergence of a new situation that requires an adequate response from the decision maker.

The management of processes and objects in any field of human activity is replete with uncertainty and conflict ^* . These problems are often so complex that the right decisions require a lot of preparatory work to choose the best option. One of the most promising and effective methods of obtaining the right solutions in such cases is the method of studying business and industrial situations.

In the domestic and foreign practice of training managers ^*, in recent years, the method of studying economic and production situations - "case study" - has been widely used.

The main objective of the method of analyzing specific business situations is the development of analytical skills and the inculcation of skills in the application of acquired knowledge. The essence of the method lies in the fact that students are familiar with the description of the specific situation prevailing in the enterprise, determine the problem inherent in the situation. After identifying the problems, several alternative courses of action are developed and possible positive and negative consequences of each action are considered. Finally, the most correct solution is developed. Thus, the decision-making process is the essence of the method of specific situations .