4.2.3 Disadvantages of existing management structures and requirements for their construction

Improving the efficiency of any organization is impossible without a radical restructuring of the management structure and integration processes occurring at the level of an economic entity. It should be borne in mind that such a reorganization is a very complex and psychologically difficult process.

Among the main sources of bureaucratic opposition to change are inertia and conservatism of personnel. Strong internal "political reasons" - the emergence of coalitions and interest groups, the feeling of winning some at the expense of others, primarily due to the need to revise many old decisions, honest recognition of mistakes and miscalculations, self-critical attitude of managers ^* to their own behavior. The unwillingness and unreadiness of people to change is present both in relatively prosperous organizations and in companies that are on the verge of collapse. Sources of resistance to reorganizations are also rooted in the current system of corporate traditions and moral values ​​that influence people's behavior, in nostalgia for the “good old days”.

Today, the main hopes of management are laying on a strong economic leader - a carrier of organizational change, who sees not only the shortcomings of the existing structures, but also the ways to eliminate them.

When developing a program for reforming a company, it is necessary to remember that the current management structures have the following main disadvantages:

1. First of all, it should be borne in mind that management structures are extremely conservative and extremely difficult to restructure. Therefore, it is important to show that it is in these forms that the source of many flaws is presently present and they cannot be eliminated without their restructuring. In other words, it is necessary to overturn ideologically the idea of ​​the inviolability of existing management structures.

2. The existing management structures are characterized by the absence of clear responsibility in the management system for achieving certain results . Linear and functional responsibilities are intertwined, and many bodies are involved in responsibility for the same thing. The absence of a strictly designated administrative (organizational) and sole responsibility closed from beginning to end with the provision of appropriate rights and opportunities to exercise this responsibility is the main cause of organizational imperfections and contradictions in the existing governance structures. The most significant example is the responsibility for quality (all and no one in general).

3. Under the conditions of universal responsibility and the vertical (top-down) nature of interaction, a decision-making system is formed, which is characterized by two major drawbacks:
   a) the so-called kick-off - a bureaucratic approach, when instead of making a decision, the formal execution of their duties is carried out;
   b) instead of solving the problem at the level where it arises, pushing the problem upward in order to reinsure and because each higher level of the hierarchy is also suspended and is responsible for solving the problem, as is the lowest. Hence the current practice, when the highest level of leadership is fully engaged in solving the problems of a lower level.

4. Each control unit (technical, production, economic, procurement, etc.) is focused in its activities on private, local goals that are out of touch with the general goal of the company, they operate, but do not interact.
   The desire to achieve only their goals inevitably leads to contradictions between technical services and production (new equipment and current plan), production and economic (production plan - at any cost), etc. This isolation for the purposes of activity leads to at least two negative consequences:
   a) the loss of the principle of unity of command in the management system, when the heads of functional services (deputy heads of marketing, production, finance, etc.) have the right of command of production units (each in their own field, but to the detriment of another activities). This causes the need for coordination at a higher level, leads to constant conflicts ^* and adverse situations;
   b) the use of specialized planning documents originating from functional services, but not coordinated among themselves in terms of terms, resources, financial sources.

5. Most specialists have the so-called tunnel vision, which remains even when they are moved from one control to another. These blinders on the eyes - the main difficulty (psychological "barrier") after the decision on new forms of organizational work.

The management structure ^* in today's conditions should provide a solution to a number of fundamentally new tasks for the firm’s activities (see Figure 3.22), primarily:

1. reliable, reliable information about the market, the structure and dynamics of demand, tastes and desires of customers, i.e. information about the external conditions of the company;
2. orientation of the company when choosing a product range that it intends to produce on the possibility of ensuring the production cycle with all kinds of resources;
3. rational selection, placement of personnel and successful solution of the social program;
4. the creation of such a product, product range that meets the requirements of the market better than a competitor's product, satisfies the demand, solves the problem of the consumer;
5. sales of their products and normal financial well-being;
6. The estimated profit of the enterprise and its distribution.

Fig. 3. 22. The structure of the priorities of firms

These are fundamentally new tasks that are of prime importance today. Moreover, the concept and program of reforming the company must first of all be guided by the fact that it is the new management structure ^* that would allow to successfully solve these problems.

In the field of the management structure, it is possible to set forth the general principal directions of its restructuring, based on the typical situations typical of the majority of firms. Then, on the basis of these general directions and established goals, specific project fragments of the structure can be developed, which will ultimately form the firm's management structure.

In developing organizational structures, it is necessary to focus on the following basic requirements:

1. Focus on achieving goals. Since the goals are the main characteristic of any organization, the management structure ^* should contribute to their achievement. This is achieved by establishing rights and the necessary full responsibility of each managerial level for achieving the tasks assigned to it, balancing the tasks of one level of management in relation to the goals of the higher level, rational division and cooperation of labor between the levels and levels of management and their interaction.

2. Perspectivity is expressed in the fact that only operational issues should not be resolved in the control system; work is needed to define a strategy ^* related to the future development of production and management. To this end, it is necessary to provide in the organizational structure a block of prospective, strategic management, separating it from the block of operational and current management.

3. Ability to develop. The need for the development of organizational structure is due to the tendency of continuous improvement of production, changes in external conditions, and imbalances in the management system. Under these conditions, the organizational structure ^* should be sufficiently resilient, capable of perceiving corrective actions. In practice, this can be achieved through the creation of temporary target groups (divisions), development services, etc.

4. Coordination of interests. Due to the deep division of labor that led to the creation of divisions, a multiplicity and contradictory interests of the participants in the management process appear. For example, the interests of the workers of the machine shop do not coincide with the interests of the workers of the assembly shop. The first, seeking to improve the efficiency of their shop, are interested in reducing the range and increasing the size of batches of products, reducing the number of changeovers of equipment, etc., which leads to an increase in incomplete production, its incompleteness. Workers of assembly production are interested in the timely provision of the assembly with all necessary. Moreover, the receipt of parts of assembly units of component parts should be carried out in the required volumes as needed and without unjustified reserves, which requires significant storage space and additional costs. Contradictions can be not only between workshops, but also within one team, between the supplier and consumer of products, etc.
   Thus, in the organizational structure there must be a mechanism to reconcile the contradictions, to establish reasonable compromises.
   This can be achieved by introducing an appropriate specialist into the structure of the legal and sociological services, organization of labor collective councils.

5. Individualization . Each company is unique in the sense that it has its own characteristics, due to the established composition of personnel, equipment, formal and informal management relations, and many other features. Therefore, the development and implementation of measures to improve the organizational structure should flow from its features. In this regard, all sorts of standard recommendations can only be used as indicative data.

6. Efficiency. Organizational structure ^* should contribute to the most rational implementation of management processes, increase the productivity of managerial workers when they perform the necessary functions. Profitability can be achieved through various activities, including the creation of units, whose functions would be to analyze the existing organizational structure, the functional and hierarchical division of labor, the organization of management processes, etc.