Total management

I like soccer and although the Dutch national team is currently struggling to display the sparkling forms and styles of the past, I keep following their progress eagerly. It was in the seventies that Dutch football was at its peak and twice in a row reached the final game in the world cup tournaments of 1974 and 1978. Under the leadership of its coach Rinus Michels the team introduced the concept of “total football”. This concept implies a strategy in which the entire team coordinates and works together to achieve its common purpose, which is to win the game. Defenders were pushing forward to serve the strikers, while the midfielders and front liners worked hard to cover gaps in the defence. Even the goalkeeper played the ball far out of his area as if he was an extra filed player. Forgive me for being biased but I still think this was some of the best team football ever seen. Where players are not really complementary and not supporting and covering up for each other, results will be hard to achieve as can be observed in teams with some of the world’s best individual players and yet not living up to expectations.
Now, what has this to do with doing business? In fact, some very close parallels can be drawn here if we compare a football team with a management team. I often observe that companies and organizations do not use the management team concept very effectively. Instead, departments are managed separately, seemingly not coordinating their outputs and complementing their hard work to achieve the mission of the organization. Looking at the finance department for example, we observe that staff is busy feeding systems with figures that will result in balance sheets etc. Rarely does the department analyse the information and present it in a way, useful for decision makers. As a result, the business owner will not know exactly where the company is making or losing money, whether products are priced right and what strategic decisions need to be made. It must be said as well that managers do not often demand such input from their departments either, thus missing the opportunity to gain deeper insights in the actual affairs of the business.
Things may look different if we introduce the concept of total management in our business and realise that general management is made up of five basic elements, namely:
1. Strategic Management
2. Production Management
3. Human resources Management
4. Financial & Administrative Management
5. Marketing Management
We can structure our business around these elements, for example by setting up departments and hiring people with specific management skills. We can also structure the agenda of our board and management team meetings, following this basic division. Even the annual, quarterly, monthly, weekly and daily planning can be built on this foundation, as long as the important issues under each division are dealt with.
1. Strategic management deals with the longer term plans of the company and decisions related to that, for example: Are you going to expand, develop other products, export your products, and position the company more strategically?
2. Production management looks into the production process, quality, quantities, product development, and design.
3.Human resources management includes issues like job descriptions, recruitment & selection, performance assessment, staff development, motivation, discipline.
4. Financial management works the accounts, costing, pricing, analyses the figures, deals with taxes, paying the bills, the payroll. And administrative management includes stock control, logistics, contracts, archives, assets etc.
5. Finally, marketing management deals with advertising, customer relations, communications, PR, networking, sales, packaging and information.
We must realise that no business can run well while ignoring one or more of these elements of management. And no manager can do it all, so it is important to hire people who do know about the specifics and who are specialised in their own field. I see many businesses which are weak in their human resources management, resulting in a high staff turn over or little motivation. Other companies ignore their production management, resulting in the quality of their products going down instead of improving. Others again do not make a proper analysis of their costs to set the price for their goods, not knowing whether they are loosing or making money on certain items. Manage your business in a comprehensive way and be consistent in it is my suggestion. In other words, introduce the concept of “Total Management” and include the department heads in your management team. In this way, management is complementary and can make well informed decisions to achieve results that collectively contribute to the mission of the organization.