How to organize the business

The "traditional" management system is generally Taylorist and objective-based; it involves management focused on functions and the clear and defined oversight of their boundaries. Each manager or director is assigned the task of achieving a specific objective, for example: increasing sales, reducing inventory, improving product quality, reducing debt collection times, or maintaining constant personnel costs. It focuses primarily on costs and efficiencies, resulting in so-called "cost center" management. The "integrated" approach, prioritizing value generation mechanisms, places greater emphasis on process oversight: the implication of this second model is the need to redesign the company's organization.

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Business management models

What motivates a company to adopt a centralized or decentralized structure? Centralization is the most restrictive way to coordinate decision-making. All decisions are made by a single person, and then implemented through direct supervision. On the other hand, a company adopts a decentralized structure simply because all decisions cannot be made by a single center, by a single person. Decisions may not be easily communicated because they are too qualitative and therefore difficult to communicate, or because the single decision-making center cannot understand them. Decentralization, on the other hand, is adopted both because it allows the company to respond promptly to local conditions and because of its ability to motivate.

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How to design a control system

The already turbulent economic climate of recent years, with the effects of globalization and the industrial development of countries such as China and India, has emphasized the need for small and medium-sized businesses to adopt management planning and control systems. Management control can be defined as the set of processes, methods, techniques, and tools available at various organizational levels that enable individuals, in accordance with their roles and responsibilities, to monitor the achievement of specific objectives established during strategic planning and operational programming, both proactively, concurrently, and subsequently.

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The role of the management consultant

Given changing market dynamics, the greater ease of circulating know-how, and greater transparency regarding competitors' actions, companies have acquired extensive expertise in formulating strategies, and management consulting is increasingly sought for support in implementing a strategy already developed internally. Continue reading the attached article...

Management control: a necessity for SMEs

Management control is often confused, especially in small and medium-sized enterprises, with cost accounting or industrial accounting.

Management control, on the other hand, was born as a management control, that is, as a tool to support management in controlling company management, essentially articulated in the following phases:

• strategic planning and definition of objectives and indicators;
• cost accounting;
• budgeting;
• data collection and reporting;
• reporting and variance analysis;
• calculating the cost of the product or service;
• financial analysis.

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Crisis prevention and turnaround

The first real challenge is to perceive the company's state of crisis and generate a profound awareness among management and shareholders that the situation requires radical change. In this context, it is essential for the company to have a management control system that allows it to evaluate key performance indicators (KPIs) to monitor economic and financial conditions and identify the symptoms of a potential crisis, primarily by identifying its internal and external causes. A key element of management control is a system of financial, management, and other indicators that, subject to constant monitoring, can support the delicate process of identifying the symptoms of a crisis and subsequently identifying the appropriate corrective actions.

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Solutions for restructuring bank debts

Once you've recognized the difficult moment, you should consult a consultant, professional, or firm specializing in debt restructuring. In less complicated cases, a single restructuring tool may be available: for example, a medium-term loan to consolidate short-term debt, or the securitization of receivables, through which companies raise funds by selling their receivables. Continue reading the attached article...

The annual budget: theoretical and practical aspects

Management software: an example model

A handy spreadsheet for budgeting costs, revenues, investments, and financing needs, as well as forecasting balance sheet, income statement, and cash flow statements, with a view to minimizing financial costs and maximizing profits: download the file for free!

Financial balance between income and expenditure

With regard to the time variable, we distinguish two aspects of financial equilibrium: immediate short-term solvency and the structural correlation between sources and uses (financial structure). The expected gap between cash inflows and outflows constitutes the forecasted overall cash flow and represents the forecast summary for the entire financial branch of management. Continue reading the attached article...

How to calculate balance sheet ratios

A handy spreadsheet for determining key profitability ratios (ROE, ROI, ROA) and financial structure (primary and secondary liquidity): download the file for free!

Temporary Management: When and How

TM interventions are normally classified into five macro categories:

1. transitional management (management of phases to cover sudden and temporary managerial gaps);
2. project management;
3. corporate crisis management;
4. skills management;
5. business change management.

More specifically, TM interventions can therefore have the objective of:

• manage a turnaround situation;
• get a company or business unit back on track before selling it;
• manage a change, of culture, of strategy, of structure;
• launch new businesses abroad;
• manage post-merger situations;
• coach a permanent manager;
• manage the transition while waiting for a permanent manager to take over;
• contribute to successfully managing the generational transition;
• manage a targeted project.

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