Moved by our “Learning and Teaching” value, since 2010 Prof. Falconi shares his management experience and knowledge with the readers of Exame magazine on a monthly basis. Through objective answers, he establishes a dialogue and clarifies doubts about methods, entrepreneurship, career and leadership, among other topics related to the business world.
Check out the March/2017 column below. Enjoy your reading!
MAKING MONEY IS NOT THE CAUSE. BUT YES THE CONSEQUENCE
1. I am an heir of an educational group about to take on a role in management. Should I primarily focus my efforts on financial results? Or should I use my intuition to choose certain subjects as a priority, such as those related to people, even if they do not result in short-term gains? Anonymous
Financial indicators are, in fact, the most important ones for measuring the health of a company. Without a balanced financial situation there is no company that works well. These indicators clearly show the main shortcomings of the organization. Each line of the income statement for the year indicates a different origin and by analyzing each one, you can then begin to take action.
For example, what is hindering your results? Is it the financial charges? So you have to do something to financially restructure your business – either by disposing of assets or by restructuring debt. Is it the operating costs? Then you will have to cut expenses. Is it because of the revenue that is falling? Finally, your financial information maps the main problems of your company. Without a doubt.
One thing I’ve learned in my life is that although “making money” is definitely not (or should not be) the main reason for being a company, financial indicators shows the priorities of managerial performance. It is good to say: the main purpose of a company is to serve the customer. By doing this well, earning money will be the desired outcome.
In a company, you always have little time and resources to do everything that is necessary, and therefore you have to set priorities. These priorities should be determined by financial indicators and other relevant criteria, such as government regulations and the control of occupational accidents.
Your second question concerns people. The performance of people in a company must be a constant and their participation is fundamental. In my opinion, you should be involved from recruitment and performance evaluation to promotions and dismissals of employees. We all have talents, that’s biblical. However, few people will have the exceptional talent needed for your business. If you can over the years select exceptional people, you will certainly have an exceptional company.
2. I would like to know, what is the best way to talk to the employer about a salary increase. Anonymous
First of all, we need to be clear about some facts. The value of a salary is a market issue. When there are no qualified people available, the work is worth more. When there are more people available, it’s worth less. If you have knowledge that is important to the company, it is worth more. If not, it is worth less because you can be replaced at any time. If the company is doing well, it ends up paying better. If it is going badly, they withhold the increases, which is obvious to ensure their own survival.
That being said, the answer to your question depends greatly on each situation and each person. I would rather use the market. I do not think I would ever ask for a salary increase. If you think your work is not being recognized, look for other opportunities. Talk to friends and explain what you can do.
Facing a concrete alternative and a firm salary offer, and if you appreciate the company where you work, go to your boss and talk to him about the offer you received. If he really likes your work and values it, he will give you an increase. Otherwise, I suggest you change jobs.
3. What do you think of the industries that invest in the implementation of management systems, such as ISO 9000 standards and more advanced problem solving techniques before, or in parallel, forming the 5S culture? Haroldo Ribeiro, São Paulo
All of these things are important and often you must use devious ways to get where you want to be. In consulting you learn this quickly to survive. When it comes to implementing management systems, it is best to choose financial priorities. Start with the one that gives the most results right away. This will give you credit for doing other things that do not yield results in the short term, but they serve to form a positive culture, such as the 5S Japanese methodology that serves as the basis for overall quality.
Either way, training and practicing all the time is the problem solving method that is the most important. Many people confuse “administration” with “management”. Administration involves all human factors, technical knowledge and methods to run a business. You can then speak of “administration model”. Administration encompasses management.
However, management deals only with problem solving and involves strategic planning, management by guidelines, project management, and day-to-day work management. Managing is solving problems. This is what brings positive results at the end of the day.
Source: Exame.com – Visual Management column – 03/08/2017
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