Management as a system for managing companies takes into account the mentality of the population in the country where business processes are carried out. There are practically no indigenous models of development, as companies were initially tasked with catching up with European business standards. The mentality is a fairly stable construct, unlike the unstable market conditions. Therefore, ignoring it would be a deliberate mistake in organizing business processes.
- Family ties are still strong and do not allow businesses to be organized based solely on the professionalism and qualifications of counterparts.
- Entrepreneurs prefer to first calculate the profit of their competitors and then ensure that their revenue is higher. If this is not forecasted, the venture simply won’t be started.
These two points slow down the development of corporate social responsibility. In most cases, the ethical behavior of modern domestic companies is based not on an internal mission but on the desire to create a certain image. On the other hand, this is also a positive trend, although it has pragmatic goals.
- Production-oriented: This type of thinking focuses on the product, the methods, means, and volumes of its production. Concepts such as the external environment, the needs of the target audience, and even the target audience itself remain outside the focus of attention.
- Marketing-financial: The key goal of this type of thinking is the level of sales and operational profit. As a result of actions within this system, a brand may be formed. However, it will not be filled with a value component.
- Communicative: This type of thinking is based on forecasting and modeling the development of business processes. Entrepreneurial activity is a system of interaction between groups of people on whom the company’s existence depends (founders, managers, employees, customers, partners, investors, government agencies, media, competitors, public organizations).
It is believed that a combination of these three types of thinking is a condition for sustainable business development.
NLP: Effective communication with minimal costs One of the effective tools used within the communicative approach is neuro-linguistic programming (NLP). The key idea of this technology is modeling, that is, creating universal algorithms that would standardize the management process and transmit key information between departments, as well as between the company and its audience without distortion.
The main goals of NLP are considered to be:
- Increasing the efficiency of the management team’s thinking.
- Improving the efficiency of internal and external communications, minimizing internal and external costs.
- Developing specific communication skills.
The use of NLP technologies allows for separating the structure of the text from its content, which makes it possible to use the same key information in messages of different constructions, algorithmically addressed to different groups of communication agents (consumers, partners, etc.).
How to choose a business model? Depending on the type of activity and the dominant type of thinking within the company’s management, a business model is determined, according to which business processes are structured.
A business model logically describes how an organization creates and delivers goods or services to customers and acquires economic, social, and other types of value. The development of a business model is conducted in parallel with and in accordance with the company’s strategy.
Today, the following types of business models are distinguished:
- Franchising: A type of relationship between market entities where one party grants the other the right to a specific type of business for a certain fee, using a developed business model.
- Direct sales: The sale of consumer goods and services conducted from person to person outside of stationary retail outlets.
- B2B (Business-to-Business): A type of informational and economic interaction classified by the type of interacting entities (legal entities). Companies supply goods and services to other companies rather than to the end consumer. For example, the production of advertising materials for another company that is engaged in promoting a product or service.
- B2C (Business-to-Consumer): A form of e-commerce aimed at direct sales. It is an effective way to eliminate geographic distance between large and small cities by unifying pricing policies and the activities of delivery services.
- B2G (Business-to-Government): Communication between business and government. This system characterizes e-commerce and is used, for example, in organizing government procurement.
- G2B (Government-to-Business): A set of software and governmental tools for online interaction between the executive branch and commercial entities (government websites, government procurement, etc.).
Outsourcing: Trust but verify The listed business models do not always imply the fulfillment of all tasks by the company itself. If non-core functions emerge, which are traditional for the company (i.e., must be performed continuously to maintain the organization’s functionality), these types of work are outsourced.
Outsourcing is the transfer of traditional non-core functions of a company to external contractors (in essence, a refusal of one’s own business process).
The following types of outsourcing are distinguished:
- IT outsourcing
- Business process outsourcing (e.g., administrative and housekeeping services)
- Industrial/production outsourcing (in-house production is more expensive due to its non-core nature than outsourcing to external agents)
Startup: How to bring a product to market Outsourcing services are often used by creators (founders) of startup projects. Startups are new forms of companies in their initial development stage. These companies are primarily built around a single project, centered on a specific and well-developed business idea. The uniqueness of startups lies in the fact that the idea must generate stable and fairly high income, and in the initial stage, only a small number of people work on it (typically from two to five). For a successful startup project, three components are necessary: an idea, people, and investors.
Examples of successful startups include Windows, Apple, Google, and the creation of the first Silicon Valley by Stanford University graduates.
The implementation of a startup project is logically divided into several stages:
- Pre-startup: From conceptualizing the idea, and creating a business plan, to the initial launch of the product or service to the market.
- Pre-seed: The development of the technical (technological) regulations for the production of the product/service after analyzing consumer expectations and activity, and attracting investors.
- Seed: The so-called seed stage, during which the market is studied, the startup plan is drafted, the initial technical assignment is executed, and the product is tested.
- Prototype creation:
- Creation and refinement of alpha and beta versions of the product.
- Organization of public access to the beta version of the product.
- Prototype creation:
- Product launch, service delivery:
- Growth stage: The product takes a stable position in the market.
- Expansion stage: The business plan is mastered, and business expansion occurs (geographical, production, etc.).
- Exit stage: Investors leave the project. The startup begins to function as an independent economic entity.