General Management I Notes PDF

GENERAL MANAGEMENT I  UNIT 1. THE COMPANY AS A SOCIO-ECONOMIC REALITY 1.COMPANY CONCEPT 1.1 CONCEPT OF COMPANY Company: Is an institution in which a group of people transforms various resources into goods and services, which meet a set of need, in order to obtain...

GENERAL MANAGEMENT I  UNIT 1. THE COMPANY AS A SOCIO-ECONOMIC REALITY 1.COMPANY CONCEPT 1.1 CONCEPT OF COMPANY Company: Is an institution in which a group of people transforms various resources into goods and services, which meet a set of need, in order to obtain benefits. It is necessary for the company to organize and structure its resources and the work of employees in a way that provides added values (benefits) in the generation of the goods and services. According to Menguzzato, M. and Renau, J.J. (1991) companies are defined as: - TECHNICAL-ECONOMI UNITS: they transform a set of resources through the use of certain technology into a product or service that has economic value. The complexity of the company as a technical unit can be very high or reduced. If the company did not generate economic value in the transformation process, it would not be able to continue operating in the long term. - POLITICAL SOCIAL UNITS: it is where people (social elements) work, risk, decide and collaborate with those who must reconcile their interests and objectives with business interests (which is achieved through political negotiation processes). - UNITS OF DECISION: it makes possible to establish a border between what belongs to the company and what does not. Several factories, several holdings or several commercial premises may belong to the same company provided that they are part of the same decision-making unit. ENTERPRISE, Process of information: Tangible resources (physical and financial), intangible resources, human resources, goods and services. Added value: outputs value – inputs value 1.2 ORGANIZATION DEFINITION Organization: a group of people who, with the appropriate means or resources, function through a set of procedures and rules established to achieve a certain end. All organizations share three specific traits: ✓ They exist to achieve one or more ends ✓ They need a set of resources of various kinds ✓ They require the existence of a structure that allows coordinating the activity and relationships between the various material and human components Terms related to company - Commercial company: legal unit. Legal form that regulates the relationships that produce the resources contributed by two holders or more people. - Exploitation: technical unit. Set of technological processes. - Plant or establishment: physical unit. Place where the economic activity of a business is located and developed. - Business: activity relating to buying and selling and pursuing a profit. - Industry: activity that aims to make objects. 1.3 DISTINCTION BETWEEN COMPANY AND ORGANIZATION The difference resides in the purpose for which they were created. COMPANIES ORGANIZATIONS Purpose of an economic nature (although they may have The ends are not economic in nature (although they may other non-profit purposes), they are for profit and intend be profit-oriented in order to continue to exist) to obtain benefits that must be reverted in the short or long term to their owners - Most of the companies are organizations - Not all the organizations are companies CLASIFICATION FOR ORGANIZATIONS Economic criteria: Legal criteria: CLASIFICATION OF THE COMPANIES EMPRESA Nº DE TRABAJADORES VOLUMEN DE ACTIVO CIFRA DE NEGOCIOS Micro