Company Structure, Value Chain, CSR, Ethics and SMEs
Company Definition and Objectives
It is a set of items organized and coordinated by management, aimed at obtaining a set of goals while acting under conditions of risk.
Objectives: The goals that the company seeks to achieve according to its sector of operation and its environment.
Value Chain and Competitive Advantage
The value chain: The company identifies sources of competitive advantage and its areas of activity such as production and support. If these activities cannot be profitable, the company may subcontract them to another firm.
Elements of the Company
The company comprises several essential elements that interact to achieve objectives and create value.
Human Factor
The human factor: People directly linked to the company, from owners to workers. Human resources are central to operations, decision making and execution.
Material Factor
Material factor: Economic assets such as fixed capital and variable capital. These physical and financial resources support production and service delivery.
Organization
The organization: The relationships of coordination, communication and authority among the human group that forms the company, both internally and externally.
Environment
The environment: Factors that influence the activity of the company but do not belong to it.
Service Enterprise Areas
Service enterprise: Typical functional areas include:
- Investment and financial area
- Production area
- Commercial area
- Human resources area
Company as a System
System as the company: The company is an open system because it interacts with the environment and consists of a combination of different subsystems. It is also a global system because its influences affect one another and vice versa.
The Environment: General and Specific Factors
The environment: These are the factors affecting the company in the area in which it operates. They include:
- General factors: political, legal, cultural
- Specific factors: suppliers, sectoral laws, competition, customers
Corporate Social Responsibility
Corporate social responsibility: The company must consider economic, social and environmental aspects in its decisions and operations.
Business Ethics
Business ethics: Ethics, honesty and quality must be part of company management, as they increase prestige, retain consumers, motivate staff and generate profit.
SME: Definition and Features
SME: 99% of all enterprises in Spain are SMEs.
Organization:
- Small enterprises: <50 employees and up to 5 million euros a year turnover.
- Medium-sized enterprises: <250 employees and up to 10 million euros per year turnover.
Features
- Positive: flexible organization, motivated and integrated, develops markets, creates jobs.
- Negative: poor training, limited financial capacity, low skills and limited staff training.