Strategic Management in the face of economic crises

Table of Contents

Introduction
First part
Second part
diagnostic tool
SWOT analysis
SWOT matrix:
Third-part
The plan
Financial
Non-financial
Fourth part
Leadership
Fifth part
Human resource
Recommendations
Conclusions
Bibliography

Introduction

First part

Economic crises have always been present and in different ways, so the specter of crises runs through the entire world, René Báez states that its center of gravity is located in the developed capitalist countries, but its effects are irrigated to the international community through complex economic, technological and financial mechanisms. Here we briefly analyze some of them:

In 1973, when during the war between Arabs and Jews, OPEC proclaimed a partial embargo on supplies, and promoted a general rise in crude oil prices, which in a few weeks multiplied almost four times; The brutal crisis now had as a prelude the worldwide monetary problems of the early seventies, as mentioned by Ramón Tamames, in his book La Economía española, of the transition to monetary union, the turbulences of that time disrupted the monetary system (SMI) of the International Monetary Fund (IMF), which was based on the gold/dollar parity……

Tequila effect: This began on December 20, 1994, when the Mexican government decided to devalue the currency, this crisis affected other countries including Argentina. By 1995 the situation was under control, but the GDP had fallen, and some 10,000 companies had closed and their inflation exceeded more than fifty percent, there was credit restriction, the immediate consequence was a paralysis of production and unemployment.

The Southeast Asian crisis: (1997) Between October and November, an abrupt fall in the Hong Kong stock market, which as a domino effect caused havoc in London, Wall Street, Brazil, and Argentina (again, the shares fell by 20 %) and also affected neighboring Colombia.

Difficulties appear in Japan, after two decades of sustained growth, this also affected Russia, which took measures to deal with the crisis (fluctuation of the ruble against the dollar) consequently, this resulted in investors cutting off the credits they planned to grant to Russia.

The Asian crisis of 1997 and 1998, together with the subsequent ones in Russia or Brazil, added new elements both from the point of view of the characteristics of the crises and of the policies to prevent and resolve them. In general, the countries affected by the Asian crisis did not show fundamental deterioration, their economic policies were orthodox, and there was no indication that governments wanted to change. However, the fragility of these economies seemed to lie in the balance of incentives derived from economic management and the weakness of the financial and corporate systems.

Rice effect: The “crisis”, popularly called the “rice effect” (in what appears as a macabre play on words with what was called the “tequila effect” although it recognizes different causes) involved catastrophic losses in the value of the currencies of the emerging countries usually known as “Asian tigers” such as South Korea, Malaysia, Singapore, Indonesia, the Philippines; forced international “bailouts” forced by the directors of the IMF in an unusual liberalization that involved the delivery of more than 110,000 million dollars to avoid global default (Thailand – Indonesia – Korea).

The situation created caused falls in all the world’s stock markets (affecting even the G7 countries to a greater or lesser degree).

On the other hand, the collapse of Thailand devalues the currency by 18%, (the Bath) this affects its balance of payments producing large deficits, (due to the fall in its exports) and is complemented by the devaluations of Singapore, the Philippines and Malaysia, (crisis for some analysts focused on Asia, to defend against the speculation produced). The effects could not be expected; unemployment, poverty, social violence, and stagnant consumption as a result of the recession and the global crisis. (Many knowledgeable people called it one of the worst crises since World War II.)

Caipirinha effect: The speculative shocks unleashed against the Asian currencies spread a series of financial turmoil, which ended up causing significant falls in the price of securities on the stock markets, and in a large number of countries, regardless of which they were. their economic conditions. Of the economies affected by this process of global speculation, Brazil was the one that experienced the most severe shock.

In addition to registering in a few days a drop in the Sao Paulo Stock Exchange index of more than 30%, the price of external debt securities plummeted (the C-Bond fell by 67%) from its face value) and, finally, the turmoil spread to the foreign exchange markets, which recorded a net capital outflow of more than 8,000 million dollars, threatening the stability of the currency.

Between 2001 and 2007 Spain experienced what was probably the biggest real estate bubble in the world thanks to the fact that around 60% of all loans from a financial system heavily indebted to foreigners went to brick. Spain, then, oozes debt from all sides after having lived for years far beyond its means. Spain is facing the biggest economic crisis in the last 40 years, with employment problems, facing growing budgetary imbalances, and an intense economic recession that has just begun, with the threat of raising taxes and skyrocketing public debt.

The United States in 2008 was affected by the crisis of the so-called housing bubble, and by the abnormally low value of the dollar, where central banks had to intervene to provide liquidity to the banking system, but the collapse dragged the bankruptcy of banks and financial institutions in an unprecedented situation.

The financial crisis leaves several lessons about the limits of self-regulation in financial markets, in the context of the high level of international interdependence. The global recession caused by the bursting of the housing bubble in the United States (subprime mortgage crisis) highlighted both the structural imbalances in the world economy and the imperfections of national financial systems—particularly those of the United States. and Europe—and their international interconnections. Different types of global structural imbalances have contributed to this crisis, including i) excess debt in the United States and excess savings in China; ii) the excessive tendency to accumulate international reserves in developing countries, which causes a recessive bias in the global economy, given a defective monetary order that does not ensure stability among the main international reserve currencies; iii) a financial system that has proven to be ineffective in anticipating and avoiding increasingly frequent financial crises and promptly providing the necessary financing to avoid balance-of-payments crises and contagion effects to better-performing economies, and iv) the lag of financial regulations in the face of globalization and innovation in the sector, which results in the internationalization of risks and a reduced monitoring capacity on the part of governments.

“The international financial and economic crisis has literally hit households in many emerging countries in Europe and Central Asia,” said Philippe Le Houérou, Vice President of the World Bank’s Europe and Central Asia Regional Office. “What started as a financial crisis has become a social and human crisis. The international crisis came on the heels of the food and fuel crises, which had already weakened the region’s inhabitants by reducing their purchasing power. Today, the increase in poverty and unemployment is pushing many households into poverty and is aggravating the situation of those who are already poor”.

As can be seen at all times, companies have had to overcome adversities that the environment has presented them, some with more ingenuity than others but the important thing is to continue in the market, some companies apply administrative tools such as ABC, management by competencies, chart integrated command, six sigma, strategic planning, reengineering, benchmarking, business plan, CRM, competitive advantage, economies of scale, the experience curve, globalization, etc. One of the tools that allow us to monitor the changing environment in globalization is the SWOT analysis and that will help us understand the position of the company in the face of the adversities of crises and exogenous situations that may affect the development of the organization.

Second part

diagnostic tool

SWOT analysis

The analysis of the strengths, weaknesses, opportunities, and threats of the companies that go through adversities, must concentrate on the results of the analysis of the organization (internal), of the analysis of the environment (external).

A SWOT analysis allows you to look at strengths and weaknesses in the context of opportunities and threats.

It is a tool that facilitates the analysis of the environment of the company or organization that is going through economic crises in the different countries where they occur, describing the internal shortcomings or weaknesses of the organization (those functions, activities, and processes that are poorly designed or poorly executed) and skills or Strengths (functions, activities, and processes that are well designed and well executed) are found in the internal environment.

The strengths and weaknesses (limitations) are part of the internal world of the institution, where the future can be directly influenced. Opportunities and threats take place in the external world of the institution, which is not controllable but without influence. The issues listed must be specific to each particular company.

Opportunities

The new way to exploit a company’s strength.
Sales growth trend.
Expansion of the customer base.
Acceptance of the company’s products or services.
Sustained increase in market share.
New agreements with suppliers that could reduce the costs of raw materials and materials.
Advantages of the product or service, compared to competitors.
Changes in the lifestyles of clients.
Introduction of new technologies.
Possibility of segmenting markets more effectively.
Possibility of selling the products or services in the most convenient segments for the company.
Expansion of market coverage.
New organization or expansion of the sales network.
New uses or applications of the product or service.
Possibility of launching new products.
Improvements in customer service capacity.
New possibilities for your use of advertising, promotion, etc.
Opening new markets.
Changes in the composition of the clientele.

threats

Changes in lifestyles Decline in sales growth trends.
A very small customer base.
Declining market for products or services.
Poor distribution of products or services.
Ineffective advertising messages. Propaganda to improve the institutional image
Loss of company image.
Loss of important clients.
Very low profitability.
Shortage in the supply of raw materials, packaging materials, etc.
Severe limitations in production or customer service capacity.
Impossibility of penetrating a market dominated by competition. Price or service war
Fierce price competition in the market.
Notorious customer dissatisfaction.
Changes in customer needs wants, and expectations that the company cannot meet.
The inability of the company to incorporate new technologies to customers.

Strengths

Dominant market position
core competencies
Scale economics
low-cost position
Leadership and management team skills
Financial resources
Manufacturing skills and technology
Investigation and development
brand and reputation
differentiated products
Patents and intellectual property
Distribution network

weaknesses

Low market share
Few core competencies
ancient plant
high-cost basis
Weak balance sheet and cash flow
Little ability to assign roles and responsibilities
undifferentiated product
weak positioning
Quality problems
lack of distribution
skills gap

The concept of a good leader is not the one who puts out fires but the one who foresees the consequences

SWOT matrix:

SWOT matrix

Internal Forces External Forces	Strengths (Maxi)	Weaknesses (Mini)
Opportunities (Maxi)	Maxi–Maxi	mini-maxi
Opportunities (Maxi)	Analyze the market and determine the sectors in demand Have a marketing department to accelerate market growth Expand the premises and add new equipment to make them profitable Hold events together to reduce rivalries Acquire low-energy consumption equipment	Discard obsolete equipment for high-tech equipment Search for an appropriate organizational control system Implement an internal control system Increase staff to improve information systems
Threats (Mini)	Maxi–Mini	mini–mini
Threats (Mini)	Encourage frequent customers Search for software for better network management Get more entertainment software Lower fixed costs	Strategic Alliances.- Ally with nearby competitors such as PC-Mania Fusion.- Analyze the competitor to see if a merger is advantageous Liquidation.- Liquidate at cost price Entrenchment.- Subsist through a fixed clientele without expanding to the market

Third-part

The plan

A business plan as a tool in the face of adversity is a document that serves as the basis for the relaunch of a product or service, where, among other things, it details what is expected to be achieved with that project, what the plan will cost, the time and the resources that will be used to achieve it, and a detailed analysis of all the steps that must be taken to achieve the proposed goals.

According to Cohen, there are two types of business plans: The plan for a new product or service and the annual plan. The first refers to the product or service to be introduced to the market, and the other when the particular product is already in production, we need to make changes in the approach or positioning in the market.

As for the business plan, it applies to products already on the market, and to new products which are going to hit the market, and which through ID have been studied to satisfy customer needs. (Philip Kotler says that Marketing: “is human activity aimed at satisfying needs and desires through a process of exchange”.)

The annual review allows for discovering new problems, opportunities, and threats that are overlooked in the daily life of the organization and even more so when there is a crisis.

Below you can find an answer to the question about what should be the purpose of a business plan:

Description of the company’s environment: It allows knowing the market, competitors, current legislation, economic conditions, technological situation, expected demand, etc., as well as the resources available to the company. According to Graham Friend and Stefan Zehle, when analyzing the environment it is important to know the pressures in politics, changes in consumer attitudes, and the development of new technologies. For authors, there are three levels of change:
Stable: There is little or no change in the environment. Any change that occurs is slow, easily identifiable, and predictable.
Dynamic: There are changes in the environment, but the rate of change is moderate.
Turbulent: They are characterized by having a large number of unpredictable and rapid changes, and they are characterized by a high degree of technological development.
Management Control: Anticipates possible changes and plans the necessary deviations to overcome them, allowing new paths to be found that lead to the desired objectives. Thus, it allows us to see the difference between what is planned and what is happening. Ken Blanchard says in his book The Secret, A Business Tale, to be able to visualize the future.
Scope of the objectives: The programming of the project is extremely important and therefore all those involved must understand what their responsibilities are and how their activities fit into the overall strategy. By way of example, some financial and non-financial objectives are presented:

Financial

Increase profits
Promote the evolution of the organization.

Non-financial

Integration of all parts of the organization.
Review new and existing services
Staff improvement.
Increase administrative efficiency.
Fundraising: In fact, it is what the business plan is used for on most occasions, let alone when you have to get out of adversity.

Already in 1975, Peter Drucker said: “you have to make what you sell and not try to sell what you make”.

Every company, regardless of its size or the sector in which it operates, needs to develop a business plan. This must meet a series of requirements to be effective and demands from those responsible a realistic approach to the situation of the organization, that its preparation be detailed and complete, it must include and develop all the objectives, it must be practical and affordable for everyone. staff, at a determined periodicity, with their corresponding improvements, and shared with all the organization’s staff. A great challenge that arises for the management of the organization in this century is the productive factor and that of Management Capacity.

The trend toward globalization of markets and business activity arises from impulses or decisions in a changing environment, and that are systematically coupled to functional strategies and operational decisions.

The first stumbling block that entrepreneurs encounter is the challenge of creating a successful company. To respond to this challenge, they must have the ability to discover a market need and develop a suitable product or service to satisfy that need.

It is not necessarily possible to think that to be able to compete in a globalized market it is possible to compete with low prices, the analysis of trends is an indicator of what we can do to continue in the market and the decisions that we can make regarding the turn that should carry out the organization if you want to continue producing and/or selling.

If we respond adequately to these challenges, a company will likely experience rapid growth, at this point, it faces a set of obstacles and challenges of survival.

Business decisions should always be made based on the strength of the business idea, but it is much easier to decide if the idea is clearly and concisely conveyed through a business plan.

The Manager must recognize all this so that the company does not face difficulties, he must know the operating systems to be able to launch a product or deliver a service and work on a base.

The organization must take into account that it requires plans, whether organizational or formal discipline since it commits itself to enter into formal planning that we can associate with a lifestyle, where tasks as well as obligations, roles, and responsibilities acquire a special touch that will allow us to address both the objectives, goals, measures, rewards that the organization intends to achieve.

Graham Friend and Stefan Zehle, in their book How to Design a Business Plan, say: no two businesses are identical, and no two business plans are ever alike, but good business plans have common themes. They “tell a story” and explain how the business will achieve its objectives in a coherent, consistent, and cohesive way. The “story” will focus on customer needs. The Plan will identify the market, its growth prospects, target customers, and main competitors. It must be based on a set of credible estimates, and it must identify those estimates to which the profitability of the business is most sensitive. It must also identify the risks faced by the business, the potential drawbacks, and the actions that will be taken to mitigate the risks.

When developing plans it is important to consider their effectiveness and profitability, this implies thinking of a global commercial organization in which changes in key sectors must be planned since this will allow successful progress in the different stages.

Eric G. Flamholtz, in his organization development pyramid, considers six key tasks.

Discover and define a market gap. The fundamental requirement to create a successful organization, the market is made up of buyers who demand goods and services that the organization tries to produce and sell, the possibilities improve if the organization discovers a need that has not yet been adequately satisfied or that it has little competition to satisfy it. This process involves the use of strategic planning to discover the market.
Create products and services. It consists of analyzing current and potential customers to design products that meet needs.
Get the resources. In many cases, it is very complex to obtain the resources, even though the market has been identified and products and services have been designed to satisfy the needs.
Create operating systems. To function effectively, an organization must take into account accounting systems, billing, collections, advertising, recruiting, staff training, sales, and production, so that they facilitate daily operations.
Creation of administration systems. These systems that are required are planning, organization, management training, and control.
Management of business culture. Just as all people have their idiosyncrasies, all organizations have a culture, which can be summed up in a set of shared values, beliefs, and norms, which govern how staff are expected to run the business daily.

Fourth part

Leadership

Since the word management implies control and even more so backed by power and authority, it is necessary to remember that its origin is in the administration of the house, some remember it in the mule convoys of the army, perhaps this displeases many professionals in their autonomy and esteem, today we talk about alliances, teams, a delegation of powers, the keywords are commitments, the possible and finally the title of manager is being abandoned for team leader, project coordinator, facilitator, and they recognize that organizations are communities of individuals and not a collection of human resources.

The task of the leader is to ensure that individuals or groups are competent to exercise the responsibility assigned to them, understand the objectives of the organization, and commit themselves to them.

That is, leaders must demonstrate their competence, this means that leaders must be given time and space to demonstrate their worth.

When organizations are redesigned to become what they are, there are opportunities for leaders to emerge, this creates trust and authority, which must be deserved, and if necessary, proven, as Charles Handy says.

Leading a community of individuals where authority must be deserved is an arduous task, Handy says, and demands an unusual combination of attributes:

Believing in yourself, persuading others to go where no one has gone before.
Passion for work, energy, and focus that drive others forward.
The leader must love people, few will thank the leader when things go well, but many will blame him if things go wrong.

The need for a leader is evident and real, and it increases as the group’s objectives become more complex and broad. Therefore, to organize and act as a unit, the members of a group elect a leader. This individual is an instrument of the group to achieve its objectives and his abilities are valued to the extent that they are useful to the group.

The leader is not a leader because of his capacity or ability in itself, but because these characteristics are perceived by the group as necessary to achieve the objective.

The leader differs from other members of a group or society by exerting greater influence on the activities and their organization. The leader acquires status by getting the group or community to achieve its goals. The leader has to distribute power and responsibility among the members of his group.

Leadership is a crucial issue today where borders have been opened to global trade; where organizations and companies are permanently in a constant struggle to be better and more competitive, which has led the people that make them up to be more efficient and capable of giving much of themselves to achieve the well-being of the community. organization.

When talking about organizations and people, it is essential to mention the drivers, the leaders of today, are those who achieve the success of their organizations and who guide their subordinates to achieve it.

The leader, like every person, has many defects and virtues that he must know; This implies looking inside oneself first, getting to know oneself, and then understanding others and reflecting on what he wants to achieve, what he seeks to achieve with others to achieve success.

Leadership style: One of the most decisive managerial functions of organizations is leadership or leadership, a requirement to function efficiently since leadership influences the behavior of others in a way that gives them more probability of achieving goals. of the organization.

Management work is complicated, demanding and has a special touch, which is why managers must exercise great influence to achieve an adequate level of efficiency and productivity, while the degree of effectiveness is given by personal effort, to which must have the ability to choose and apply methods or techniques that are appropriate for a given situation.

Managers must fulfill and develop basic functions that affect daily work such as:

Interpersonal Relations: Because he is the visible head of the company, and is the representative of formal acts or the link of various departments.

It is Informative: Because it is constituted in being the disseminator of the information, and the valid interlocutor.

He is Decision-maker: it is the most difficult and delicate role, which he has to fulfill since he must distribute the resources of the company.

The aptitudes also play their role and these have to do with the intellectual part since they have to analyze and interpret and solve problems that involve complexity.

Interpersonal relationships: they are equally important at all levels because they are related to the operational aspects of the company.

Computer systems: Tools that support administrative, production, and other processes, with which we can manage efficiency, effectiveness, and effectiveness.
Organizational structure: It constitutes how the personnel is organized to carry out productive work and facilitate the achievement of the plan, it must be designed in such a way that it facilitates commercial operations.

On the other hand, strategic management involves deciding the “COURSE OF THE COMPANY” and what is required to achieve them. It includes analyzing the environment of the company, to evaluate future opportunities and threats, consists of formulating objectives and establishing goals as precise plans to achieve them.

The plan must be effective and not only cover external opportunities, but also internal ones, the final goal is to formulate the future course, that is, how the company plans to compete in the market, and thus compete effectively and fulfill its long-term mission. When talking about strategy, it is necessary to point out the three levels:

Corporate level: This is formulated by senior management to monitor the interests and operations of the company, and is made up of multiple lines.

Business level: Refers to the administration of the interests and operations of a particular line, this aims to determine what position the business should adopt before its market and how it should act, given its resources and market conditions.

Functional level: In this strategy, managers are in charge of a function, for example, production, and marketing, to put into practice the strategies of the business unit and therefore those of the company.

In other words, strategic management is a logical and systematic process that will make it possible to reach a consensus on the company’s decisions, and thus bridge the gap that exists between now and the place we want to go, with the objectives proposed by the company. the company, as well as the resources it will use and will use, which causes things to happen that otherwise would not have happened, such as exploring the environment to assess where the company hopes to compete.

Strategic management is an essential element for the success of your business, but many companies do not take advantage of it effectively to guide their activities. Some of the main reasons are mixing the basic or daily aspects of the business with future activities, vague Missions and Visions, and lack of monitoring and follow-up on progress.

The Vision must guide all organizational change and all improvement activities. The best way to do this is to capture the Vision in a long-term goal. We then need to identify three to five key activities that will ensure that the Vision will be achieved.

This long-term plan is the starting point for the annual planning process. The annual plan identifies the essential things we must accomplish that year to achieve the Vision. All other critical activities and processes must then be deployed in all necessary areas. Owners of these critical activities and processes must be identified and assigned to then develop performance measures that will allow us to monitor progress.

Due to the above, we can state that the lack of strategic management does not allow sustainable and sustainable development.

The business foundations are the guiding principles of the organization’s actions, elements from which management is structured, also because they express interest in the growth and development of people.

Plan: that is, establish a global objective that unites the actions of all employees. Example. How many units must be produced, to meet a goal or otherwise establish longer-term objectives which can vary from one to five years.

Organize: be aware of the tasks that must be done, that is, establish the relationships that must exist between the different jobs.

Provide staff: cover vacancies to develop the jobs required by the organization.

Lead: know how to provide adequate motivation and leadership to bring encouragement and a spirit of achievement and cooperation.

Monitor: stay alert and check that things are being done according to forecasts.

To expand these concepts a little more, resources should not be forgotten, which can be tangible or intangible, from which the company’s objectives can be met.

As Eric Flamholtz would say, managing the business culture, is because all organizations have a culture that is nothing more than a set of shared values, beliefs, and norms, which govern how staff are expected to manage the business daily.

Implementing a strategic management model will allow the company to project itself into the future, control changes, adapt to market conditions, and find ways to channel continuous improvement in the company.

Management practices and roles are determined to create and maintain competitive qualities in staff, following Drucker’s line, which suggests “making ordinary people do extraordinary things”.

Strategic planning is one of the main resources through which management can create a shared vision of what the company wants to become, contributes to shaping the business culture, and becomes a way of life as it provides direction. for the organization and its staff, since it motivates and guides behavior.

The strategic approach involves the direction that the organization is going to take and the capabilities it needs to achieve its goals, it analyzes the organization’s environment to assess future opportunities and threats, and even more so with a globalized and standardized market in which companies that are not prepared are likely to disappear, it is worth emphasizing that the objectives as well as the goals must be precise to formulate action plans that we can achieve.

It is worth mentioning that strategic plans should not only cover the markets and external business opportunities that the organization envisions but also the internal capabilities that the organization requires for its growth.

If people or organizations think about strategic planning, it is important to think that the development that is intended to be achieved is for the organization, since the final goal of the strategic planning process is to formulate the course of where the organization plans to compete in the market. , taking into account the conditions of effectiveness to fulfill its mission in the long term.

The strategy is what gives realism to a plan since it is constituted in the art of directing a set of operations-oriented to the achievement of an objective because the strategy refers to the procedures that must be established to reach the goals. objectives and goals.

Strategic decisions are the choices that determine the direction and success of organizations. Although many of those in charge of taking them are CEOs, entrepreneurs, and leaders, it is increasingly common to see that middle managers also receive that responsibility. This is why organizations are more horizontal than ever before and more customer-focused than ever, as well as being driven by the forces of change and complexity, which are becoming more intense and accelerating.

Although any organization must comply with a variety of issues that should be addressed, some points must be taken into account, according to Eric G. Flamholtz the key points that must be considered are the following:

What business are we in?
What are our competitive capabilities and limitations
Do we have any exclusive market gap?
What do we want to become in the long term?
What are the critical factors that will make us succeed or fail in trying to accomplish the mission?
What are our competitive capabilities and limitations that will determine our competitive effectiveness?
What goals will we set to improve our competitive effectiveness and organizational capabilities in each of these critical success areas?

Most specialists think that the turbulent business environment is complex, therefore, today the best method is continuous analysis. This allows the company to act quickly, take advantage of opportunities before competitors, and thus respond to environmental threats before significant damage has been done.

Regarding the economy, for example, inflation, unemployment, income, consumption, profitability, investment, and trade balance should be analyzed, to mention a few indicators that cannot be ignored, the political climate, laws, taxes, and minimum wages. laws, unions, labor codes, levels of education, schools, hospitals, the technological field latest advances in production processes, and most important today the ecological aspect, to be committed to bioethics and the social.

At the moment that we analyze these variables, we are preparing to face the threats and opportunities that the environment can offer us, that is, to anticipate the impact that the organization may suffer.

We cannot forget about the microenvironment, which allows us to evaluate the strengths and weaknesses that we have in the organization in its internal part, understanding the strengths as the capabilities that are found within the organization, and with which we hope to achieve the proposed objectives. Not so the weaknesses, which constitute the limitations that are found within the organization and that, at the same time, are the ones that slow down the progress towards the achievement of the objectives.

Fifth part

Human resource

Human resources: It takes years to recruit, train and develop the necessary personnel for the formation of competitive work groups, which is why organizations have begun to consider human resources as their most important capital, and their correct administration as one of their most decisive tasks.

However, managing this resource is not a very simple task. Each person is a phenomenon subject to the influence of many variables, including differences in aptitudes and behavior patterns that can be very diverse.

If organizations are made up of people, the study of them constitutes the basic element of organizations, particularly of Human Resource Administration. (Recruitment and selection of capable personnel, maintenance of the spirit of cooperation of all personnel, to fulfill the mission of the organization and, use of personnel services effectively, that is, the rational use of the efforts of the human resource)

The process of the endowment of human resources in the organization occurs because it provides the people who will use their muscles and their minds, helping to make the company’s mission a reality. Staffing requires planning (current and future evaluation and development of a future program) and the necessary forecasts that guarantee adequate recruitment, that is, neither excessive nor insufficient.

The success of recruitment lies in carefully and precisely defining what the position requires of the candidate who is going to fill it, together with his remuneration, which must be appropriate and competitive.

Taking this as a basis, the next step is to start a process to form a group of candidates from which to select the most qualified and integrate them into the organization.

The continuous monitoring of human talent requires carrying out training and development programs for all employees in combination with a periodic evaluation of their performance. For this reason, the manager becomes a leader and assumes the provision of human resources.

Recommendations

A SWOT analysis is highly recommended for companies since they can know the position of the company and it contributes to the generation of strategic alternatives.

The business plan is useful in several ways and helps us in the face of adversity,

Define and focus on the objective making use of the analysis of the collected and appropriate information.
It becomes a sales tool and faces important relationships (lenders, investors, banks)
Integrates the main regulatory documents
It arises from the conceptual, methodological, and management need to specify the strategies in economic, technical, technological, and financial terms.
It is a logical, progressive, realistic, coherent, and future-action-oriented document to achieve objectives and goals.

Conclusions

The leader must know the level of relationship with his followers since in this way he can foresee the fulfillment of his objectives.

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