Business Fundamentals: Organization, Leadership, and Employee Motivation

Defining a Company

A company is a set of persons and resources dedicated to obtaining goods or services with the aim of achieving a greater benefit.

Types of Companies

• According to Legal Form: Trader or sole proprietor, or trading company.
• According to Sector: Primary, secondary, or tertiary.
• According to Ownership: Public, private, or mixed.
• According to Size: Small, large, or medium.

Leadership and Decision-Making

Leadership involves making decisions to achieve specific goals. It can be:

• Centralized: Decisions are made at the highest level.
• Decentralized: Decisions are delegated at various levels.

Organizational Levels of Responsibility

• Steering: Decisions are made for general matters that affect the entire organization.
• Executive: Decisions are technical, relating to compliance with plans and programs designed to achieve overall objectives.
• Operating: Focuses on the development of related tasks.

Core Functions of Management

The core functions of management include: Plan, Organize, Direct, and Control.

Organizational Structures

• Formal Organization: This is the intentional arrangement of different tasks and responsibilities, structuring them to achieve objectives.
• Informal Organization: This is a network of informal relationships that emerge within the company among people and groups, not planned or established in advance by management.

Steps in the Organizational Process

1. Determine the activity to be performed.
2. Divide this activity into manageable parts.
3. Arrange the divisions and identify individuals who will be responsible for them.
4. Establish the human and material resources required for each division.
5. Establish a communication system that facilitates decision-making.
6. Define a control policy.

Internal Marketing Principles

Internal Marketing involves recruiting, training, and motivating staff to adequately serve the customer. Effective internal marketing ensures employees fulfill their tasks responsibly to achieve set objectives.

Characteristics of Internal Marketing:

1. The internal customer is the employee to whom we must 'sell' the business idea. This also highlights the need for meetings or group brainstorming.
2. What we 'sell' is the company itself, offering features like: better working conditions, greater employee participation, a better working environment, increased integration and motivation, and higher productivity.
3. To 'sell' the company, a key tool is the Internal Communication Plan. This plan conveys policies, objectives, and actions downwards (selling the enterprise idea) and gathers feedback upwards from the internal market.
4. The sales force (managers, directors, and company control personnel) plays a fundamental role in internal marketing.
5. The ultimate objective is the overall motivation of workers to increase overall productivity.

Qualities of Effective Leaders

Enthusiasm

• Takes the initiative
• Instills confidence
• Builds on achievements

Maturity

• Balanced perspective
• Self-Confidence
• Respect for others
• Active Listening
• Keeps commitments

Integrity

• Adherence to principles
• Loyalty

Motivation

The driving force that compels a person to act and perform their job in the best possible way.

• Internal Motivation: Depends on the individual's character.
• External Motivation: Influenced by specific work situations.

Key Theories of Motivation

Theory X and Theory Y (Douglas McGregor)

Theory X

• People are inherently lazy.
• They work as little as possible.
• They avoid responsibility.
• They need to be coerced or controlled.

Theory Y

• People are creative.
• They enjoy working and collaborating.
• They seek and assume responsibilities.
• They are self-motivated towards perfection.

Maslow's Hierarchy of Needs (Abraham Maslow)

Understanding human needs helps us comprehend their motivations.

Maslow's Hierarchy Pyramid:

1. Self-Actualization
2. Esteem
3. Social
4. Security
5. Physiological

Maslow asserts that a satisfied need is not a motivator; rather, it is the unmet needs that drive motivation.

Herzberg's Two-Factor Theory

According to Herzberg, hygiene and motivation factors must be addressed to prevent dissatisfaction and foster satisfaction.

Hygiene Factors

• Salary
• Working Conditions
• Job Security

Motivator Factors

• Recognition
• Advancement/Promotions
• Responsibility
• Personal Growth/Development

Methods of Motivation

• Threat: Managing through fear.
• Reward: Managing through incentives.
• Respect for Individuals: Fostering a participatory environment, emphasizing the role of leaders, and applying motivation theories.