1.1 Globalization and free trade. Pros and cons.

Globalization can be described as a process by which the people of the world are unified into a single society and function together. This process is a combination of economic, technological, sociocultural and political forces. It's a movement of people, goods, capital and ideas due to increased economic integration.

I think that globalization is an extremely complex web of many things and like any other process it has its positive and negative sights.

Pros of Globalization

1. Productivity grows in countries that open up their markets and integrate with outside economies, as they gain access to wealthy economies where they can sell their goods and services.

2. Lesser Developed Nations benefit from the increase in investment from foreign countries both financially and through jobs.

3. Global competition and cheap imports help to keep inflation down.

4. Open economies help to spur innovation and new ideas on a global level.

5. Through globalization, countries can specialize more in what they produce and what they do best.

Cons of Globalization

1. Wages and working conditions everywhere are pushed downwards as companies gravitate towards countries where the wages are the lowest and the workers’ rights are the worst.

2. The environment suffers, as production moves to places where they have less strict rules and regulations about controlling pollution.

3. Globalization means that economic problems in one part of the world can spread easily and create a worldwide recession.

4. Many of the deals made by more economically developed nations with lesser developed countries are unfairly weighted in favor of the more developed nations.

5. Globalization undermines national sovereignties and national governments, as individual countries become increasingly at the mercy of international markets, and multinational corporations grow more powerful and influential.

And in the end I'd like to say that globalization is still a controversial issue for businesses and governments throughout the world and nobody knows when a compromise will be found.  

1.3

Fair trade is an organized social movement and market-based approach that aims to help producers in developing countries to make better trading conditions and promote sustainability. The movement advocates the payment of a higher price to exporters as well as higher social and environmental standards. It focuses in particular on exports from developing countries to developed countries, most notably handicrafts, coffee, cocoa, sugar, tea, bananas, honey, cotton, wine, fresh fruit, chocolate, flowers, and gold.

Key principles

Fairtrade is an alternative approach to conventional trade and is based on a partnership between producers and consumers. Fairtrade offers producers a better deal and improved terms of trade. This allows them the opportunity to improve their lives and plan for their future. Fairtrade offers consumers a powerful way to reduce poverty through their every day shopping.

Тhe minimum price paid to Fairtrade producers is determined by the Fairtrade standards. It applies to most Fairtrade certified products. This price ensures that producers can cover their average costs of sustainable production. It acts as a safety net for farmers at times when world markets fall below a sustainable level. Without this, farmers are completely at the mercy of the market.

When the market price is higher than the Fairtrade minimum, the buyer must pay the higher price. Producers and traders can also negotiate higher prices on the basis of quality and other attributes.

Fairtrade standards exist for food products ranging from tea and coffee to fresh fruits and nuts. There are also standards for non-food products such as flowers and plants, sports balls and seed cotton.

General structure of the movement

Most fair trade import organizations are members of, or certified by one of several national or international federations. These federations coordinate, promote, and facilitate the work of fair trade organizations. The following are some of the largest:

The Fairtrade International (FLO), created in 1997, is an association of three producer networks and twenty national labeling initiatives that develop Fairtrade standards, license buyers/label usage and market the Fair trade Certification Mark in consuming countries. Fairtrade International, the non-profit arm, oversees standards development and licensing organization activity. Only products from certain developing countries are eligible for certification, and for some products such as coffee and cacao, certification is restricted to cooperatives. Cooperatives and large estates with hired labor may be certified for bananas, tea and other crops .

The World Fair Trade Organization (formerly the International Fair Trade Association) is a global association created in 1989 of fair trade producer cooperatives and associations, export marketing companies, importers, retailers, national, and regional fair trade networks and fair trade support organizations. In 2004 WFTO launched the FTO Mark which identifies registered fair trade organizations.

The Network of European Worldshops, created in 1994, is the umbrella network of 15 national worldshop associations in 13 different countries all over Europe.

The European Fair Trade Association (EFTA), created in 1990, is a network of European alternative trading organizations which import products from some 400 economically disadvantaged producer groups in Africa, Asia, and Latin America. EFTA's goal is to promote fair trade and to make fair trade importing more efficient and effective. EFTA currently has eleven members in nine different countries.

Criticisms

Consumers have been shown to be content paying higher prices for Fairtrade products, in the belief that this helps the very poor.] The main ethical criticism of Fairtrade is that this premium over non-Fairtrade products does not reach the producers and is instead collected by businesses, employees of co-operatives or used for unnecessary expenses. Furthermore, research has cited the implementation of certain Fairtrade standards as a cause for greater inequalities in markets where these rigid rules are inappropriate for the specific market.[35]

Little money reaches the Third World. The Fairtrade Foundation does not monitor how much extra retailers charge for Fairtrade goods, so it is rarely possible to determine how much extra is charged or how much reaches the producers, in spite of the Unfair Trading legislation.

One British café chain was passing on less than one percent of the extra charged to the exporting cooperative; consumers paid much more for Fairtrade, and only 11.5% reached the exporter. US Fairtrade coffee getting $5 per pound extra at retail, of which the exporter would have received only 2%. It was calculated that in the UK only 1.6% to 18% of the extra charged for one product line reached the farmer. All these studies assume that the importers paid the full Fairtrade price, which is not necessarily the case

Opinion:

The whole "fair trade" concept is a complete lie. It is, in fact, a way for western companies to buy organic and cheap products that brings them huge profits. I understand they idea of a profitable, but getting great stuff for almost no money at all and disguising your 100% materialistic approach in a "fair trade" concept is repulsive.

In Russia:

Fair trade as social movement in Russia is almost non-existent and consists, on the one hand, of few separate active workers and small groups, and on the other is presented by some manufacturers (for example Clipper, Qi-Teas )

I had never seen any fair trade labels on any locally produced item bought in Russia.

1.4

o much of doing business involves bargaining that it's a shame so few people have a natural aptitude for it. Still, there's hope for the rest of us, especially if we learn from those who have mastered the art of negotiation. In 7 Secrets of Great Entrepreneurial Masters, business coach Allen Fishman offers these techniques he has learned from decades of working with top entrepreneurs and applied in his own negotiations:

1. Provide information to build trust  Tell your negotiating partner something meaningful he didn't already know. When Fishman's team conducted due diligence on one potential acquisition, it uncovered serious problems unknown to the current owner. Fishman revealed the problems to the owner and urged him to fix them even if the deal fell through. The owner's suspicion dissipated and they got down to serious talks.

2. Find the final decision-maker  Your first meeting might be with a subordinate who was sent to handle the early stages of bargaining yet acts as if she has the full power to negotiate a deal. If you ask her directly whether she has the authority to finalize the transaction in all respects, you'll likely get an honest answer, but she might not volunteer this fact. If you assume she's the final decision-maker, you might make all your concessions to her and have no ammunition left to offer the person with the power.

3. Keep it impersonal  Focus on the action you wish to achieve, not on whether you like your negotiating partner. Although he may have needs that conflict with yours, treat him as a person playing a role, not an enemy.

4. Use questions to pry open undisclosed information  If you ask a series of fact-gathering questions about the potential agreement, you might uncover a deal changer or breaker. Often you'll learn something your opponent wasn't hiding but simply hadn't thought about. Fishman once asked the owner of a real-estate property he wanted to buy whether the owner had any tax needs the deal's structure could help address. The potential seller had never thought of this possibility, so hadn't brought it up. But once Fishman heard the owner's tax concerns, he called a top tax attorney who found a way to address them. That paved the way to a deal.

5. React to body language  Many people reveal non-verbally that they're not as adamant about a negotiating point as they claim. When Fishman was negotiating a strategic alliance, he understood that his opponent's pursed lips meant that even though she was apparently rejecting a term he saw as essential to the deal she didn't in fact have her heart set on turning down the alliance. Without registering any emotion, he reworded the question slightly to change a minor factor in his proposed terms. She agreed without hesitation.

6. Laugh off intimidation tactics  In one negotiation Fishman witnessed, a six-foot-three man who towered nine inches over his negotiating partner moved in nearly nose-to-nose to put himself in the power position. But the shorter man didn't get rattled or angry. Instead, he smiled sweetly and said, "Jim, you're invading my space. If you want to get anywhere with our discussion, you'll have to back off."

7. Be the one with superior "butt power"  Many negotiations are won because the losing side lacks the patience to sit in endless meetings. Your own sense of urgency to conclude a deal can be your worst enemy, and an opponent who senses this might try to pressure you into a hasty deal by setting an arbitrary deadline. Ask yourself whether there's a logical reason for the deadline to exist. Some of the best deals are made long after a "final" deadline has expired.

2.1

Every day new and new companies appear in the world. If you have decided to create a business with the revenues of 1 million $ a month you need money. And the main question is where can you get it for company`s development.

And I`d like to tell you about one of the main part of economy, about investment. But to understand it clearly, we need to know its classification.

First of all, investing activity is an investments and taking practical actions to make it profit. Investments have many classifications: facility, by maturity, the form of ownership and so on. But I`d like to present you the main purpose of investing. They distinguish:

• Directed

• Portfolio

• Real

• Non-financial

• Smart investments

Directed are investments funds in the material production in order to participate in enterprise management. These types provide possession of a controlling stake.

Portfolio investment is a passive ownership of securities, such as company bonds and shares and doesn`t provide for investor participation on the part of the company`s management.

What about real investments or, in other words, capital investments – a cash funds of capital goods – machinery, buildings and land.

Non-financial associated with investments in the investment project – a legally valid rights, licenses, know-how and so on.

And the last one associated with the training of specialists, conducting courses and many others.

As a rule, depositors invest in high-return business or contribute to the near gain in overall sales. Making decisions investors trust the view of their business – analytics team which calculates if the investor gets profit or puts his investment in risk. Unfortunately, we often can see and hear histories about unsuccessful investing. Let`s see factors affecting investment decisions.

Firstly, the mail criterion for investment is investor confidence in the profitability of the project. It`s very important for a depositor to know that his investment will not only return, but also generate income!

Secondly, a substantial investment criterion is the possibility to «exit» of the investor. Because everybody knows about such definitions like risk and liquidity of company. Here we have in mind the possibility of an investor to sell his shares of the capital by the end of the period of investment.

The third criterion is a cycle of the company`s development. Majority of investor are prefer to finance project that is in stage of rise, because it`s not profitable to invest stagnation or downturn company.

Try to meet the investor in all of these factors, then the probability of investment will significantly increase your project and your company will never be liquid.

2.2

Ways of raising finance in different types of business

To earn money it’s necessary to invest them at first. The more is planning to earn, the more it’s necessary to invest.

In other words, money makes money. Basic ways of raising finance are:

-credits;

-investments;

-sponsorship;

-leasing

Credit is a loan of financial and national recourses with a return. Credit can be given by private person, bank and the state. All types of credits are regulated by legislation.

So, if you’re going to take a credit, you need to learn laws.

Investments are loan of recourses too. But a return of investments is making only in case of profit.

To be an investor could be any interested person, individuals, finance organizations and the state. Relationships between investors and businessman are regulated, but many things are depend on personal agreements.

Leasing is a rent of fixed assets. Businessman can take it at a specializing company. Distinction from usual rent is in legislation. Moreover, equipment getting by leasing through the time becomes a property of businessman.

Sponsorship can give financial recourses, equipment. Sponsor expects not a profit from a businessman’s activity; he pursues its own benefits. Usually, sponsor is large companies for making its image, increasing of influence on the target market.

2.3

The profit for any enterprise is the difference between revenues and expenditures for the period. Our company is engaged in consulting projects and almost all of our projects are reduced to a simple problem - increasing the profits of the enterprise. Whether the problem is to increase revenue, which - in order to ultimately increase the profits of the enterprise. Whether it is the task of optimizing the operation of the company, business processes, reduce costs - also for the fact that to increase the profits of the enterprise.

Factors affecting the increase in profits

The main factors affecting the decrease in revenue, are: The absence of a clear strategy for the enterprise; Not aligned business processes; Blurring of responsibility and authority; Lack of motivation; Lack of planning; The lack of timely accounting transparency.

Increase profits by reducing costs

The most obvious way to increase profits which seek refuge managers are reducing costs, wages, population, etc. We believe that this is premature, if not defined strategy and vision of the future of the enterprise. If your strategy was listed turnover increase by 2-3 times in the near future, it is likely that the fixed costs rise, the number of staff also need a little more. Therefore, to reduce the staff may be premature, it may be necessary just to send it to the solution of the required tasks, motivate you in the right amounts. As fixed costs it makes sense to establish a clear record and normalize them.

Methods and ways to increase profits

First, in life there are always companies that congestion in one area then another, then the suffering acceptance of orders, the supply, production, and so it is important to solve problems in the first place on the narrow stretch of limiting the growth in sales volumes. If you sell everything you produce, decide the question of how to produce more if it is impossible to optimize production, then you need to find additional production or suppliers, etc. Second, identify the strengths and strengthen their businesses, so that would be your strengths are - the undisputed competitive advantage and feature of your business.Third, to increase profits, it is necessary to solve the basic questions that should have been done a long time, but for some reason they were deposited.

Determinants of success of a project to increase profits

The determining factor in the success of the project to increase profits, a strong desire to grow leaders and get great results, ready for the upcoming leadership changes, willingness to change if necessary, personnel, etc. Intention of management to increase profits should be unconditional. If the owner or manager decides to move to a new level, and for this it is necessary to change the enterprise business processes, the format operation, organizational structure, then the management decision shall not affect the desire or the desire of employees to change their preferred habitat.

3.1

The problem of good`s quality isn`t new, because every day we have a possibility to see bad-quality goods in markets. And today I`d like to tell you about quality in various aspects.

First of all, quality is the elimination of variation or conformity to specification things should turn out as they were designed and intended to be.

For assessment of level of quality are used a system of characteristic of high-quality goods. Of course, its different for every type of production, but universal partly and the most important are technical indicators:

1. Indicators of use (functional requirements). Characterize the ability of products to effectively perform its function. They can be divided into the following groups:

• performance requirements. Indicators include the necessary power, capacity, speed and other developed that characterize the function performed;

• efficiency requirements. Characterize the degree of efficiency of use of the product as intended, such as energy performance (efficiency losses), kinematic (movement accuracy), power (the stability of the load), etc.;

• design requirements. Characterize the advantages of the chosen design, such as weight and dimensions;

2. Reliability. Consist of a combination of the following properties:

• durability;

• maintainability;

• persistence;

3. Performance ergonomics. Characterize the properties of the social product as part of the man-machine systems: the preservation of human health through the increased ease of use (conformity of anthropometric, psychosocial, psychological, psycho-physiological and hygienic measures), the full development of human personality;

4. The safety record. Characterize the possible exception of accidents during normal and unskilled work, with random acts of man and the impact of the environment, emergency and extreme situations, as well as in the manufacture of products (on a standard, and especially dangerous work). Types of safety: chemicals, radiation, mechanical, electrical, magnetic, electromagnetic, thermal, sanitary, fire;

5. Indicators of environmental performance. Characterize the fitness of the product to coexist with nature and habitat of living organisms, to share with them the energy (for example, the impact of heat into the surrounding space), a substance (eg, food contamination environment deterioration, leakage of lubricating oils) and signals (eg, izdavanie whistle, noise);

6. Indicators of aesthetics. Characterize the expression of beauty in external images of the product: the expressiveness of information, rational form, perfection of execution, the stability of the presentation, the integrity of the species;

7. Indicators of utilization. Describe ways to eliminate the product at the end of its operation during the removal and proper disposal;

8. Design and technology indicators. Characterize the effectiveness of technical solutions. Includes the following indicators:

• levels of standardization and continuity;

• indicators of adaptability. Characterize the possibility of producing goods (manufacturing and assembly with the specified quality level) with the lowest production costs in the shortest possible time;

• Indicators of transportability. Characterize the properties of the product at minimal cost to move it in space (within the production facilities, from the producer to the seller and, further, to the consumer), for example, the average batch discharge from the car, the maximum capacity utilization of the vehicle;

• performance persistence. Characterize the ability of the product does not depend (to be protected) from the adverse effects of the environment (climate, accidental or intentional).

It`s understandable that things are better made today than 20 years ago, and even small manufacturing companies apply for the certification of the certification of the international organization of standardization.

ISO 9000 is a series of international standards that that describe the requirements for management system of quality.

A series of ISO was developed by the Technical Committee 176 of the International Organization for Standardization (ISO).

A series of ISO 9000 was revised several times:

1. the first version was prepared in 1987

2. the second was released in 1994

3. the third was developed in 2000. Version 1994 has been radically revised

4. the fourth version of the standards published in 2005

Output of the fifth version of standards planned for 2012.

ISO 9000 adopted by more than 190 countries around the world as a national.

Certificate of compliance with ISO 9000 requires companies:

1. operating in such markets or with such customers that require such a certificate;

2. working in the sectors of the economy, public or corporate controlled so that the Certificate of ISO 9000 is required.

And in conclusion I`d like to say that good`s quality is the biggest problem in Russia. We have been trying to join the WTO for 18 years, because there is no effective certification of products, to my mind. I don`t know how and when our government will think about changing of a system, but not only dream of it will the best by itself. I think we need more strict low of production. First of all, don`t give licenses and insurances to irresponsible entrepreneurs for money and may be it will be better in Russia.

3.2

3.3

Concept of quality - historical background

The concept of quality as we think of it now first emerged out of the Industrial Revolution. Previously goods had been made from start to finish by the same person or team of people, with handcrafting and tweaking the product to meet 'quality criteria'. Mass production brought huge teams of people together to work on specific stages of production where one person would not necessarily complete a product from start to finish. In the late 19th century pioneers such as Frederick Winslow Taylor and Henry Ford recognized the limitations of the methods being used in mass production at the time and the subsequent varying quality of output. Birland established Quality Departments to oversee the quality of production and rectifying of errors, and Ford emphasized standardization of design and component standards to ensure a standard product was produced. Management of quality was the responsibility of the Quality department and was implemented by Inspection of product output to 'catch' defects.

Application of statistical control came later as a result of World War production methods, and were advanced by the work done of W. Edwards Deming, a statistician, after whom the Deming Prize for quality is named. Joseph M. Juran focused more on managing for quality. The first edition of Juran's Quality Control Handbook was published in 1951. He also developed the "Juran's trilogy," an approach to cross-functional management that is composed of three managerial processes: quality planning, quality control and quality improvement. These functions all play a vital role when evaluating quality.

Quality, as a profession and the managerial process associated with the quality function, was introduced during the second-half of the 20th century, and has evolved since then. Over this period, few other disciplines have seen as many changes as the quality profession.

The quality profession grew from simple control, to engineering, to systems engineering. Quality control activities were predominant in the 1940s, 1950s, and 1960s. The 1970s were an era of quality engineering and the 1990s saw quality systems as an emerging field. Like medicine, accounting, and engineering, quality has achieved status as a recognized profession.

К ЭТОМУ ВОПРОСУ + ТЕКСТ ИЗ УЧЕБНИКА СТР.87

3.4

An organisation’s achieving profitability by satisfying employees, customers and society as a result of

active participation of the employees and continious improvement in all processes .

Parties

• Hotelowners

• Employees

• Guests

• Society

Expectations of Hotel owners

1. High profit

2. High quality service

3. Guest loyalty

4. Continuity

5. Governmentpolicies

Expectations of Employees’

1. Continuity

2. Suitable salary policies

3. On time payment

4. Socialrightsandopportunities

Expectations of Guests’

1. High quality goods & services

(cleanings,food& beverages ,entertainment,

sports , security , technical equipment …)

2. Continuity

3. Improvement

4. Involvement

5. Whatever they have in their dreams

Expectations of Society

1. Contribution to the economy

2. Creating Employment Opportunities

3. Cultural Enrichment

4. Continuity

Everyone concentrates on continuity.

Conditions for obtaining continuity ( sustainability )

_ Government policies

_ Existence of vision in the organisations

_ Quality & system perspective of the

organisation

_ Opportunities for training & development

_ Planning The Sources

_ Correct sales policies

_ Employment of the suitable personnel

Government Policies

_ A consistent policy for tourism. ( publicity , marketing , municipalities, infrastructure)

_ Following the changes

_ Supporting innovation

_ To internalize the modern

approaches for management

_ Creating an atmosphere for

continuous improvement

Vision in the Organisations

_ Following the changes

_ Supporting innovation

_ To internalize the modern

approaches for management

_ Creating an atmosphere for

continuous improvement

Quality & System Perspective

of the Organisations

_ A planned work arrangement

_ Proactive approach

_ Obtaining of healthy communication between different types of processes

_ A shared common sensitivity

_ A system that is independent of the persons, yet including the persons.

_ Ability of following the results for the relevant planned activities

_ HUMAN FIRST

Training , Development and Selection of Personnel

_ Difficulty of finding qualified personnel

_ Difficulty of finding managers open to improvement

_ Difficulty of creating the time, man and money sources for training

_ The place of training conscious in the culture of the organisation

_ Seasonal changes for personnel turnover and its reflection on the service quality

_ Communication problems of the people from different cultural and educational level as of being at the same management situation

Correct Sales Policies

_ Adaptation to the market conditions effected by repeating crisis.

_ Cooperating with the suitable markets.

_ Negative effects of the rate changes over the budget limitations, caused by the market competitions

(consultancy, training programs)

Advantages – Disadvantages for TQM

_ There is always “ something ” to be done to overcome crisis that arise continiously

_ We are selling a dream, expectations of the guests are unlimited

_ We are always face to face with the guest

_ We are naturally guest-focused.

_ A labor-based work branch

_ Circulation of staff

_ Long working hours that are exhausting

Main targets of quality management in hotel industry

_ A leader that supports participation

_ Correct sales policies

_ Targets that are monitored

_ Making changes

Unconditional guest satisfaction

_ Weekly evaluations and improvements

_ Continious trainings

_ Conscious of system

_ Audits

_ Conscious of Quality

5 MANAGEMENT SYSTEMS FOR THE 5 STAR HOTEL

_ Quality Management System

_ Food Safety Management System

_ Occupational Health & Safety Management System

_ Environmental Management System

_ Customer Satisfaction & Complaint Management System

Quality Management System

_ Defining the quality policy.

_ Creating a documentation and registration system.

_ Evaluating functional units as processes. Performance criterias and targets are set and monitored.

Holding questionnaires for the Guests, Employees, Travel Agencies, Suppliers and cross functional one for department heads.

_ Making internal and external audits. (for 5 systems )

_ Following corrective and preventive actions (for 5 systems)

_ Following nonconforming products & service (for 5 systems)

_ Training plans (basic trainings for 5 systems, personel development, communications, internal trainings

for departments, on the job trainings)

Food Safety Management System

_ Defining Prerequisite programs.

_ Making risk analysis , HACCP plans

_ Setting critical control points

_ Microbiologically analysis of the food they produce, including water.

_ Directing & following the allergic guests

_ Monthly (or more often) informing audits by an independent company for food safety.

_ Having daily food engineers’ audits

_ Planning basic hygiene trainings and on job trainings.

Occupational Health & Safety Management System

_ Applying the legal conditions.

_ Setting the risks and planned the actions.

_ Setting the rules for working areas and putting warnings.

_ Following the state of health of the employees by company doctor.

_ Making routine health controls for our employees, even not asked legally. (eye)

_ Health & Safety Committee consists of volunteer personnels of different departments who are

reporting in written.

_ Registry industrial accident, occupational disease, doctor examines and incidents

Environmental Management System

_ Applying the legal conditions.

_ Setting the risks and planning the actions.Keeping the use of natural sources under control.

_ _ Giving trainings on environment.

_ Setting apart our waste as organics, glass, metal, plastic, paper, vegetable oil and hazardeous waste.

_ Noise, emission of chimneys, emissions of vehicles, grounding, pressure of compressors, discharge of sewing works should be measured and followed. (common with OHSAS )

_ Having Environment Committee which consists of volunteer personnels of different departments

Customer Satisfaction & Complaint Management System

_ Making basic system trainings and communication trainings on “ Changing the Complaints to Satisfaction ”for the personnels of different departments

_ “Your criticism is a gift for us !” should be your slogan

_ Personnel with these special rosettes have mission of accepting complaints and passing them to Guest Relations.

_ Following complaints, suggestions and demands previously, registering them

_ Setting performance periods. ( Day& night )

1. Time between accepting the complaint and informing Guest

Relations.

2. Time between Guest Relations’ being informed and passing

the complaint to relevant department

3. Time for the solution of the department

4. Time for Guest Relations’ returning to the guest.

TQM is a set of management practices throughout the organization, geared to ensure the organization consistently meets or exceeds customer requirements. TQM places strong focus on process measurement and controls as means of continuous improvement.

Before reading more about TQM, it might be helpful to quickly review the major forms of quality management in an organization. These are briefly described at the top of the Quality Management topic.

7 Important Principles of Total Quality Management

© Copyright Quin Harris

Total Quality Management (TQM) is an approach that organizations use to improve their internal processes and increase customer satisfaction. When it is properly implemented, this style of management can lead to decreased costs related to corrective or preventative maintenance, better overall performance, and an increased number of happy and loyal customers.

However, TQM is not something that happens overnight. While there are a number of software solutions that will help organizations quickly start to implement a quality management system, there are some underlying philosophies that the company must integrate throughout every department of the company and at every level of management. Whatever other resources you use, you should adopt these seven important principles of Total Quality Management as a foundation for all your activities.

1. Quality can and must be managed

Many companies have wallowed in a repetitive cycle of chaos and customer complaints. They believe that their operations are simply too large to effectively manage the level of quality. The first step in the TQM process, then, is to realize there is a problem and that it can be controlled.

2. Processes, not people, are the problem

If your process is causing problems, it won’t matter how many times you hire new employees or how many training sessions you put them through. Correct the process and then train your people on these new procedures.

3. Don’t treat symptoms, look for the cure

If you just patch over the underlying problems in the process, you will never be able to fully reach your potential. If, for example, your shipping department is falling behind, you may find that it is because of holdups in manufacturing. Go for the source to correct the problem.

4. Every employee is responsible for quality

Everyone in the company, from the workers on the line to the upper management, must realize that they have an important part to play in ensuring high levels of quality in their products and services. Everyone has a customer to delight, and they must all step up and take responsibility for them.

5. Quality must be measurable

A quality management system is only effective when you can quantify the results. You need to see how the process is implemented and if it is having the desired effect. This will help you set your goals for the future and ensure that every department is working toward the same result.

6. Quality improvements must be continuous

Total Quality Management is not something that can be done once and then forgotten. It’s not a management “phase” that will end after a problem has been corrected. Real improvements must occur frequently and continually in order to increase customer satisfaction and loyalty.

7. Quality is a long-term investment

Quality management is not a quick fix. You can purchase QMS software that will help you get things started, but you should understand that real results won’t occur immediately. TQM is a long-term investment, and it is designed to help you find long-term success.

Before you start looking for any kind of quality management software, it is important to make sure you are capable of implementing these fundamental principles throughout the company. This kind of management style can be a huge culture change in some companies, and sometimes the shift can come with some growing pains, but if you build on a foundation of quality principles, you will be equipped to make this change and start working toward real long-term success.

4.1

Types of organizational structures

Any operating organization should have its own structure in order to operate efficiently. For an organization, the organizational structure is a hierarchy of people and its functions.

The organizational structure of an organization tells you the character of an organization and the values it believes in. Therefore, when you do business with an organization or getting into a new job in an organization, it is always a great idea to get to know and understand their organizational structure.

Depending on the organizational values and the nature of the business, organizations tend to adopt one of the following structures for management purposes. Although the organization follows a particular structure, there can be departments and teams following some other organizational structure in exceptional cases. Sometimes, some organizations may follow a combination of the following organizational structures as well.

The types of organizational structures that can be observed in the modern business organizations are:

Bureaucratic Structures

Bureaucratic structures maintain strict hierarchies when it comes to people management. There are three types of bureaucratic structures:

Pre-bureaucratic structures

This type of organizations lacks the standards. Usually this type of structures can be observed in small scale, start-up companies. Usually the structure is centralized and there is only one key decision maker.

The communication is done in one-on-one conversations. This type of structures is quite helpful for small organizations due to the fact that the founder has the full control over all the decisions and operations.

Bureaucratic structures

These structures have a certain degree of standardization. When the organizations grow complex and large, bureaucratic structures are required for management. These structures are quite suitable for tall organizations.

Post-bureaucratic structures

The organizations that follow post- bureaucratic structures still inherit the strict hierarchies, but open to more modern ideas and methodologies. They follow techniques such as total quality management (TQM), culture management etc.

Functional Structure

The organization is divided into segments based on the functions when managing. This allows the organization to enhance the efficiencies of these functional groups. As an example, take a software company.

Software engineers will only staff the entire software development department. This way, management of this functional group becomes easy and effective.

Functional structures appear to be successful in large organization that produces high volumes of products at low costs. The low cost can be achieved by such companies due to the efficiencies within functional groups.

In addition to such advantages, there can be disadvantage from an organizational perspective if the communication between the functional groups is not effective. In this case, organization may find it difficult to achieve some organizational objectives at the end.

Divisional Structure

These types of organizations divide the functional areas of the organization to divisions. Each division is quipped with its own resources in order to function independently. There can be many bases to define divisions.

divisions can be defined based on the geographical basis, products / services basis, or any other measurement.

As an example, take a company such as General Electrics. It can have microwave division, turbine division, etc., and these divisions have their own marketing teams, finance teams etc. In that sense, each division can be considered as a micro-company with the main organization.

Matrix Structure

When it comes to matrix structure, the organization places the employees based on the function and the product.

The matrix structure gives the best of the both worlds of functional and divisional structures.

In this type of an organization, the company uses teams to complete tasks. The teams are formed based on the functions they belong to (ex: software engineers) and product they involved in (ex: Project A).

This way, there are many teams in this organization such as software engineers of project A, software engineers of project B, QA engineers of project A, etc.

Conclusion

Every organization needs a structure in order to operate systematically. The organizational structures can be used by any organization if the structure fits into the nature and the maturity of the organization.

In most cases, organizations evolve through structures when they progress through and enhance their processes and manpower. One company may start as a pre-bureaucratic company and may evolve up to a matrix organization.

4.2

Flexible operating schedule: illusion of freedom

Everybody wants to work in convenient facilities. Flexible operating schedule may look attractive because it gives the illusion of the freedom…

Tendency, however

Theoretically, the staff’s directors are loyal to the flexible schedule, but in practice they are not delighted with the wish of the employee to plan working day at his will.

On the one hand, development of the new electronic technologies, computers with Internet access, multifunctional phones and faxes make the work at home the reality of modern time .On the other hand, the situation to jacks choose working hours by themselves is inconvenient and unusual for employers.

The progress is unstoppable. Flexible schedule is becoming customary practice in developed countries, but Russia is behind in this aspect. During last 10-15 years good form among Russian executives is to stay day and night (spend all their time) in the offices.

Changing… There are three kinds of flexible operating schedule: individual, by turns and free.