TRAINING CYCLE: LICENSE IN MANAGEMENT

INTRODUCTION TO MANAGEMENT

COURSE NOTES

M. Eric Vekout, M. Eng., PMP, Prince2, PSM2

Introduction to Management Eric Vekout, M. Ing.

Table of Contents
I.Business Concept............................................................................................. 5
1. Definition of the companye ..................................................................................................... 5
2. Classification of companies.... 6
3. Main functions of the companys................................................................................. 8
II. Structure and Organization of Enterprises .................................10
Organizational Chart and hierarchy.................................................................10
2. Corporate culture............................................................................................................11
III. Enterprise Information System...............................................................13
Role of the information system.........................................................................................13
2. Management data and knowledge
IV. The Company Facing Its Environment15
1. Introduction to Business Strategy15
2.The Company Facing the Future: Introduction to Forecasting Analysis.........................16

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Introduction to Management Eric Vekout, M. Ing.

General objective
The general objective of this course is to provide you with a global and coherent view of management.
by introducing you to its principles, its fields, and its tools. At the end of this course, you
will be able to:
• Definewhat a company is, how it is classified, how it is structured and
how she cultivates herself.
• Identify
the main functions of the company, their roles, their interdependencies.
and their performance indicators.
• Use the company's information system, its components, its functions and its
stakes.
• Analyze the company's environment, its opportunities, its threats and its
strategies.
• Anticipate the evolution of the company, its trends, its scenarios, and its action plans.

Targeted skills
This course aims to develop the following skills:
• Conceptual skill: it is the ability to understand and integrate
fundamental concepts of management, by linking them together and applying them to
concrete situations.
• Analytical skills: this refers to the ability to collect, process, interpret and
synthesize relevant information for management, using methods and
suitable tools.
• Decision-making skill: this is the ability to choose and implement
most appropriate actions for management, taking into account the objectives,
constraints and consequences.
• Communication skill: it is the ability to express and convey
the ideas, information, and arguments related to management, using a language
clear, precise, and suitable for the audience.

• Ethical
competence: it is the ability to act and respond responsibly,
honest and respectful in the context of management, taking into account values,
standards and rules of the company and society.

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Introduction to Management Eric Vekout, M. Ing.

Management is the art of directing and organizing a business by mobilizing its resources.
human, material and financial resources, to achieve its objectives in an environment
competitive and uncertain. Management is a cross-disciplinary field that requires the use of
knowledge, methods, and tools from various fields, such as economics,
law, accounting, marketing, finance, human resources, strategy, etc.
This course aims to introduce you to the basic concepts and practices of management.
presenting to you the main aspects of a company's life, from its creation to its
development, through its organization, operation, and adaptation. This
this course will help you understand the role and responsibilities of leaders and
managers, as well as the stakes and challenges they face.

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I. Business Concept
1. Definition of the company
What is a company?
A company is an organization that produces goods or services for the purpose of
to satisfy the needs or desires of customers. It can be composed of one or
several people, and can have different legal statuses (company, association,
etc.). Its objective is to make profits, that is to say, to generate revenue.
higher than the costs incurred.
b) Economic role of companies
Companies play a vital role in the economy, as they contribute to:
• The creation of wealth: companies transform resources
(raw materials, labor, capital, etc.) into products or services that have a
added value for clients.
• Jobcreation: companies employ employees who receive
a remuneration in exchange for their work. Employees consume
subsequently goods or services produced by other companies, creating
thus a virtuous circle.
• Innovation: companies are looking to improve quality, diversity or
the effectiveness of their products or services, by using technologies,
methods or new ideas. Innovation allows companies to
differentiate from the competition and respond to changing needs of
clients.
• Competitiveness: companies are competing with each other.
others, in a local, national or international market. Competitiveness is the
the ability of a company to offer better products or services
quality, at a lower cost or faster than its competitors. The
competitiveness stimulates the performance of companies and promotes
economic development.
c) Approaches to define a company
There are different approaches to define a business, depending on the perspective.
adopted

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• The legal approach: it is based on the legal status of the company, which
determines its rights and obligations, as well as its tax and social system.
For example, a company can be a public limited company (PLC), a company
limited liability company (LLC), a sole proprietorship, etc.
• The accounting approach: it is based on financial documents of
the company, which reflects its activities and its situation. For example, the balance sheet
assets (what the company owns)
the company), the income statement presents the revenues (what it earns
the company) and the expenses (what the company spends), and the table of
financing presents the cash flows (what it receives and what it pays
the company).
• The economic approach: it is based on the market in which it operates.
the company, which determines its supply and demand, as well as its
competitive environment. For example, a company may belong
to a sector of activity (industry, commerce, services, etc.), to a branch
(automobile, textile, bank, etc.), or to a segment (high-end, low-end)
range, etc.)
• The managerial approach: it is based on how the company is
organized and directed, which determines its structure, culture, and strategy. By
for example, a company can have a functional structure (divided into
specialized functions), a matrix structure (divided into projects
transversal), or an organic structure (adapted to the needs of the field).
A company can have a strong culture (based on values, some...
norms and shared beliefs), a weak culture (based on rules,
formal procedures and controls), or a mixed culture (combining
both). A company can have an offensive strategy (aiming to
conquering new markets or customers), a defensive strategy (aiming to
to protect its existing positions), or an adaptive strategy (aiming to
adjust to changes in the environment).

2. Classification of companies
a) Types of businesses
There are different types of businesses, depending on the nature of their activity:

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• Industrial companies: they produce material goods, using

machines, tools, or technical processes. For example, a
factory, a mine, a refinery, etc.
• Commercial enterprises: they buy and sell tangible goods.
by making a commercial margin. For example, a store, a
boutique, a supermarket, etc.
• Servicecompanies: they provide intangible services,
using skills, knowledge, or talents. For example,
a consulting firm, a travel agency, a hair salon, etc.
b) Classification criteria
There are different criteria to classify companies, according to their characteristics.
that we wish to compare:
• Size: it can be measured by the number of employees, the turnover.
of business, the share capital, or the market share. For example, one can
distinguish micro-enterprises (fewer than 10 employees), small and
medium-sized enterprises (SMEs, between 10 and 250 employees), medium-sized companies
intermediate (ETI, between 250 and 5000 employees), and large companies
(more than 5000 employees).
• Thelegal status: it depends on the choice of the partners or shareholders, who
determine the modalities of creation, operation, and dissolution
of the company. For example, individual businesses can be distinguished
(EI, where the owner is solely responsible), partnerships
(SNC, SCS, SCA, where the partners are jointly liable), the
capital companies (SA, SAS, SARL, where shareholders are liable
within the limits of their contributions), and cooperative societies (SCOP, SCIC,
where employees are involved and participate in management.
• The sector of activity: it corresponds to the area in which the company
exercises its main activity. For example, we can distinguish the sectors
primary (agriculture, fishing, mining, etc.), secondary (industry,
construction, energy, etc.), and tertiary (trade, services, administration,
.etc.
• Themode of production: it corresponds to the way the company organizes
the production of its goods or services. For example, one can distinguish the
unit production (realization of a custom product or service, according to

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customer's request), mass production (realization of a large number

of identical products or services, according to a standardized process), and the
production continues (realization of a continuous flow of products or services,
without interruption or variation).
• The mode of financing: it corresponds to the way in which the company
procure the financial resources necessary for its activity. For example, one...
can distinguish internal financing (use of equity, that is -
such as reinvested profits or contributions from partners or shareholders,
external financing (resorting to borrowing, that is to say debts
borrowed from banks or financial markets), and the
mixed financing (combination of the two).

3. Main functions of businesses

a) Essential functions
Essential functions are the activities essential for the operation of
the company, which directly contributes to the achievement of its corporate purpose. The
the main essential functions are:
• The production function: it involves transforming resources (materials
premises, labor, capital, etc.) into products or services that have value
added for customers. It involves technical choices (choice of
processes, machines, tools, etc.), organizational choices (choices
of the mode of production, of the distribution of tasks, of the control of the
quality, etc.), and economic choices (choice of production cost, of
selling price, profitability, etc.
• The marketing function: it involves analyzing the needs or desires of
clients, to design products or services tailored to them, to promote them and to
distributing them. It involves strategic choices (choice of target market,
of positioning, differentiation, etc.), operational choices
(choice of product, price, communication, distribution, etc.), and
ethical choices (respect for laws, standards, values, etc.).
• The finance function: it involves managing financial resources of
the company, to ensure its solvency, profitability, and sustainability. It
involves financing choices (choice of sources of funds,
reimbursement modalities, costs and risks, etc.), choices
investment (selection of projects, evaluation criteria, deadlines and

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feedback, etc.), and management choices (choices of indicators, budgets,

dashboards, etc.).
• The human resources function: it involves managing the staff of
the company, to ensure its motivation, its competence and its loyalty. It
involves recruitment choices (choices of profiles, methods,
criteria, etc.), choices of compensation (choices of salaries, bonuses,
advantages, etc.), training choices (choices of needs, of
programs, modalities, etc.), and career management choices (choices
evaluations, promotions, movements, etc.).
b) Interdependence between these functions
These essential functions are not isolated from one another, but are
interdependent, meaning that they have interactions and influences
reciprocal. For example:
• The production function depends on the marketing function, which provides it with the
information about customer expectations, product features or
services and sales forecasts.
• The marketing function depends on the production function, which provides it with the
information on production capacities, costs of production, and the
delivery deadlines.
• The finance function depends on the production function, which provides it with the
information on investment needs, fixed and variable costs,
and the margins achieved.
• The production function depends on the finance function, which provides it with the
information on available resources, budget constraints, and
the profitability objectives.
• Thehuman resources function depends on the production function, which
provides information on staffing needs, qualifications
requirements, and working conditions.
• Theproduction function depends on the human resources function, which in turn
provides information about the workforce, skills, and motivation
employees.
These interdependencies involve coordination among functions, that is to say
a harmonization of objectives, actions, and information, in order to ensure the
coherence and effectiveness of the company. Coordination can be done through
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formal mechanisms (rules, procedures, flowcharts, etc.) or informal

(relations, networks, culture, etc.).

II. Structure and Organization of Enterprises

1. Organization chart and hierarchy
a) Types of organizational structures
The organizational structure of a company is how it allocates the
tasks, responsibilities, and powers among its members. There are different
types of organizational structures, according to the degree of centralization or of
decentralization, and the mode of coordination or specialization. For example:
• The functional structure: it groups the members of the company according to
their function (production, marketing, finance, human resources, etc.).
It has the advantage of promoting efficiency, competence and
standardization, but the downside of reducing flexibility, the
communication and innovation.
• Thedivisional structure: it groups the members of the company according to
their product, their market or their geographical area. It presents
the advantage of promoting autonomy, responsiveness, and diversification, but
the disadvantage of generating costs, conflicts, and duplications.
• The matrix structure: it combines the two previous structures by
creating multidisciplinary and cross-functional teams that depend on
times of a functional manager and a divisional manager. She
presents the advantage of promoting cooperation, creativity, and adaptability,
but the disadvantage of complicating coordination, hierarchy, and decision-making
of decision.
• The organic structure: it is inspired by the principles of organization
learning, focusing on participation, delegation, and self-
organization of the company members. It has the advantage of
promote motivation, responsibility, and development, but
the downside of requiring a strong culture, great trust and a
high skill

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b) Hierarchical levels
The hierarchy of a company is the way it organizes authority relationships.
and of subordination among its members. There are different hierarchical levels,
according to the role and responsibility of the members of the company. For example:
• The strategic level: it brings together the company's leaders, who
define the vision, mission, and objectives of the company, and which take
key decisions regarding his future. For example, the president-
chief executive officer (CEO), the board of directors, the executive committee, etc.
• The tactical level: it brings together the company's managers, who translate the
strategy into action plans, and coordinate the activities of the various
services or divisions of the company. For example, functional directors,
the divisional directors, the project managers, etc.
• The operational level: it includes the operators of the company, who
perform daily tasks, and ensure the production of goods or
company services. For example, the workers, the employees,
technicians, etc.
These hierarchical levels involve upward communication (from the bottom to
upward (from bottom to top), downward (from top to bottom) and horizontal (between the same levels)
among the members of the company, in order to ensure information, motivation, and
regulation of the company.

2. Company culture
a) Importance of corporate culture
Corporate culture is the set of values, norms, and beliefs
shared by the members of the company, which influence their behavior, their
attitude and their performance. Corporate culture is important because it:
• Give meaning to action: corporate culture allows members to
the company to understand the purpose, vision, and mission of
the company, and to identify with its objectives and values.
• Facilitates
coordination: the company culture allows members to
the company to communicate, cooperate and trust each other, in
respecting the established rules, procedures, and rituals.

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• Stimulatesmotivation: the company culture allows members to

the company to feel involved, recognized, and valued, benefiting from a
pleasant working environment, a friendly atmosphere, and a spirit of teamwork.
• Encourages innovation: the corporate culture allows members to
the company to be creative, curious and open, by encouraging the
taking initiative, sharing ideas, and continuous learning.
b) Shared values, norms, and beliefs
Corporate culture is manifested through values, norms, and beliefs.
shared, which are manifested through symbols, rituals, and myths. For example
:
• Values:these are the principles that guide choices and actions of
members of the company, and which reflect what is important, desirable and
acceptable to them. For example, respect, quality, responsibility, the
solidarity, etc.
• The norms: these are the rules that regulate behavior and attitude of
members of the company, and who define what is correct, expected and
sanctioned by them. For example, the dress code, the code of conduct,
the code of ethics, etc.
• Beliefs: these are the convictions that guide perception and
the interpretation of the members of the company, and which express what is true,
probable and certain for them. For example, the market vision, the vision of
client, the vision of the future, etc.

• Symbols: they are the signs that represent and convey culture.
of the company, and which allow the members of the company to recognize themselves
and to differentiate itself from others. For example, the logo, the slogan, the charter
graphic, etc.
• Rites:these are the events that illustrate and reinforce culture.
of the company, and which allow the members of the company to come together
and to celebrate their successes or their failures. For example, the meeting, the party,
the awards ceremony, etc.
• Myths: these are stories that symbolize and convey culture
of the company, and that allow the members of the company to be inspired and
to project oneself into the future. For example, the story of the founder, the story
of the flagship product, the story of the challenge raised, etc.

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III. Business Information System

1. Role of the information system
a) Use of information technologies in operations management
The information system (IS) of a company is the set of resources
human, material, and software resources that allow for the collection and processing of
to store, disseminate, and use the information necessary for management
business operations. The IS uses information technologies (IT), it is-
to say the computer, electronic, and telematics tools that facilitate the
creation, transmission, and processing of data. The IS plays a crucial role
in operations management, because it:
• Improve quality: the IS allows for controlling and measuring compliance
products or services that meet the standards and expectations of customers, using
quality control software, sensors, barcodes, etc.
• Increase
productivity: the IS allows for optimization and automation of the
production process, using production management software,
machine tools, robots, etc.
• Reduces costs: the IS helps minimize expenses related to materials.
first, in work, in storage, in transport, etc., using software
of inventory management, of purchasing management, of flow management, etc.
• Increases reactivity: the information system allows for quick adaptation to changes.
of demand, competition, or the environment, using
forecasting software, simulation software, decision support tools, etc.
b) Components of an information system
A SI consists of four main elements that interact with each other:
• The data: these are the raw, unprocessed information that come from
from internal or external sources to the company, and which are necessary for the
operation management. For example, data on customers,
suppliers, products, sales, costs, etc.
• Theequipment: these are the physical tools that allow for data entry,
to transmit, to process and to return the data. For example, the
computers, printers, scanners, networks, etc.

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• Software:these are the computer programs that allow for

to manipulate, to store, to analyze and to present the data. For example,
operating systems, office software, software for
management, specific software, etc.
• The people: they are the users of the information system, who have needs, some
skills and different responsibilities. For example, the operators,
managers, IT professionals, clients, etc.

2. Data and Knowledge Management

a) Collection, storage and analysis of data
Data management involves ensuring availability, reliability, and security.
data necessary for operations management. It involves the steps
following:
• Collection:it involves gathering data from various sources,
internal or external, using appropriate methods, such as the
questionnaires, surveys, observations, transactions, etc.
• Storage:
it involves recording data on suitable media,
such as hard drives, servers, databases, clouds, etc.
• The analysis: it consists of processing the data to extract information.
useful information, using appropriate techniques, such as the
statistics, spreadsheets, dashboards, information systems
geographical, etc.
b) Importance of knowledge management
Knowledge management involves valuing, sharing, and renewing the
knowledge and skills of the members of the company, which constitute an advantage
competitive for the company. It involves the following steps:
• Creation:it consists of producing new knowledge and skills, in
using creativity, experimentation, innovation, etc.
• Capitalization:
it involves formalizing and recording knowledge and
know-how, using appropriate supports, such as documents,
videos, knowledge bases, etc.

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• Dissemination: it consists of transmitting and making knowledge accessible.

know-how, using appropriate means, such as training,
meetings, intranets, etc.
• Learning: it involves acquiring and assimilating knowledge and skills.
to do, using appropriate methods such as observation, imitation,
the practice, etc.

IV. The Company facing its Environment

1.Introduction to Business Strategy
a) Basic concepts of business strategy
The business strategy is the art of defining and implementing actions that
allow the company to achieve its long-term goals, taking into account
of its environment and its resources. The business strategy is based on
basic concepts, such as:
• Thevision: it is the ideal image of the future that the company wishes to achieve, which
expresses its raison d'être, its vocation, and its aspirations. For example, 'to be the
leader mondial de la mobilité durable”, “rendre le monde plus connecté”,
etc.
• The mission: it is the concrete description of what the company does, which
specify his profession, his products or services, his clients, his markets and his
values. For example, 'to manufacture and sell electric vehicles'
innovative and efficient”, “provide social platforms and services
online messaging, etc.
• The objectives: they are the quantifiable and measurable results that
the company sets itself, which translates its vision and mission in terms
operational. For example, 'to achieve a turnover of 10 billion'
euros in 2025”, “increase the number of active users by 20% by
an", etc.
• Strategic
options: these are the fundamental choices that the company
must do, which determine its position and direction in the market. By
example, "to focus on a specific customer segment or to target a
wide market, propose a range of products or services

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"limited", "adopt a differentiation or domination strategy by the

costs, etc.
• The strategic plan: it is the document that synthesizes the business strategy.
which presents the vision, the mission, the objectives, the strategic options,
actions to take, resources to mobilize, indicators to monitor, and the
deadlines to be respected.

b) Analysis tools
The business strategy relies on analytical tools that allow for evaluation.
the company's situation and to define its development axes. Among these tools,
we can mention:
• SWOT analysis: it is a method that involves identifying strengths
(Strengths), weaknesses (Weaknesses), opportunities (Opportunities) and
the threats of the company, by analyzing its internal resources and
its external environment. The SWOT analysis allows to identify the strengths
and the risks of the company, and to define the appropriate strategies for
exploit the opportunities and counter the threats.
• Market segmentation: it is a method that involves dividing the
market into homogeneous subsets of clients, who have needs,
preferences or similar behaviors. Market segmentation
allows to target the most attractive and profitable segments for the company,
and to offer products or services tailored to each segment.
• The competitive position: it is a method that consists of situating
the company in relation to its competitors, by assessing its market share, its
growth, its profitability, its reputation, its quality, etc. The position
competitive allows to measure performance and potential of
the company, and to define the appropriate strategies to differentiate or
defend against the competition.

2. The Company Facing the Future: Introduction to Forecasting Analysis

a) Methods of anticipating future trends
The forecasting analysis is the art of predicting the future evolution of the company, its
market and its environment, taking into account uncertainties and
opportunities. The forecasting analysis relies on anticipation methods, which

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allow to identify and evaluate future trends. Among these methods, we

can cite:
• Thescenario method: it involves constructing plausible stories.
and consistent about the future, by combining assumptions about the key factors
of success, the significant events, the influential actors, etc. The method
scenarios allow simulating possible and desirable outcomes
of the business strategy, and to test its robustness and flexibility in the face of
changes.
• The expert method: it involves seeking the opinion of people
qualified and recognized in the field of study, using techniques
of consultation, of survey, of panel, etc. The experts' method allows
to gather relevant and reliable information about the future, and to
benefit from the experience and creativity of experts.
• Theindicator method: it consists of using numerical data and
mathematical models to measure and extrapolate trends
past and present, using statistical techniques, regression,
of projection, etc. The indicator method allows for quantification and
visualize the future, and define objectives and performance thresholds.
b) Long-term planning and strategic decision-making
Forecast analysis serves as the basis for long-term planning, which consists of
define the orientations and actions to be implemented to achieve the objectives
long-term of the company, taking into account the constraints and resources. The
long-term planning involves strategic decision-making, which consists of
choose the most relevant and effective options for the company, in
takes into account the criteria and alternatives. Strategic decision-making
based on principles, such as:
• Rationality:
it involves making decisions based on facts,
data and analysis, using logical, rigorous methods
objectives.
• Intuition:
it is about making decisions based on impressions,
feelings and beliefs, using creative methods,
innovative and subjective.

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• Participation:
it involves making decisions involving the parties
stakeholders of the company, using consultative methods,
collaborative and democratic.
• Responsibility:it is about making decisions that respect values,
the company's standards and rules, using ethical methods,
transparent and durable.

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