Corporate governance is not a strange phrase in the present time when the economy is developing strongly, businesses are growing up a lot. However, a business that wants to operate and survive for a long time cannot be without an effective business management system. The article below, let's Johnson's Blog learn through the article Analysis of corporate governance functions.
Learn what is corporate governance?
Business administration activities It is an indispensable system for every business when going into business. It is a system of rules and policies that help the management and operation of enterprises.
Corporate governance It also aims to balance the interests of many parties involved in the operation of the enterprise such as shareholders, state agencies, business cooperation partners with enterprises, employees, customers, environment, community. copper…
In addition, corporate governance is also considered as a process of continuous and organizational impact, with purpose from the enterprise to employees.
Work Effective corporate governance help enterprises effectively use potentials and opportunities to carry out production and business activities effectively in accordance with the objectives set by the enterprise.
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Functional analysis of corporate governance
After understanding the activities of corporate governance, you should learn about What is the function of corporate governance?. Below, Johnson Vu will share an analysis of the functions of corporate governance.
Strategic planning function
Corporate governance is said to play a huge and indispensable role in the operation of businesses. An important function to mention is the strategic planning function for the business. This is the work of the founding team and business leaders, but many businesses have succeeded in calling for the active participation of employees and participating management levels.
The function of strategic planning for businesses is considered a function that plays a decisive role in the direction of development, operational goals as well as the success of the business.
Having a specific economic strategic plan will help leaders understand the situation and business context of the market outside the enterprise, understand the operation situation of enterprises.
Work planning while managing the business Two factors are needed: time and method of implementation. Planning must be linked and coordinated across departments and management throughout.
Business management plan must take advantage of available resources and flexibly mobilize personnel to implement the most optimal corporate governance.
Not only that, the business strategy planning It also helps businesses determine the resources they need, need to prepare, specify the detailed work to be done within the resources and time available to accomplish the goals that the business has set before.
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Organizational functions of corporate governance
The organizational function is largely related to the organization of the personnel and management apparatus. This function requires defining what must be done, who is in charge, which responsibility will be responsible for and performed by which department.
Once a good human resource structure has been established, the enterprise can operate and develop stably the important elements of the business.
Tight organizational structure when corporate governance is extremely important when carrying out the functions and tasks worthy of the vision in the future.
When you want to develop or expand the scale of your business, business owners should invest in the number of departments and personnel to be able to grow from inside and outside. Especially the change in leadership approach when managing a business Equally important is the mobilization of human resources suitable for each department.
Organizational functions of corporate governance mainly related to 3 main areas. Firstly, organize the apparatus and build the enterprise structure with levels, order and positions. It will clearly indicate the rights, responsibilities and benefits of each position.
Secondly, that enterprise will organize the assignment of personnel, assign work and allocate resources to departments in the most reasonable way.
Third, the organizational function will help enterprises to develop and issue policies and coordination mechanisms within the enterprise to ensure the most effective operation.
Control function of business administration
After making a plan, planning and organizing the work in a stable manner, the enterprise will perform the control function, which plays the role of stimulating, motivating, directing, and coordinating the personnel to achieve the goals. plan has been set.
This is one of the necessary functions when you want to effectively manage your business. The function of directing and detailing the work will help employees know what they should do to meet the overall goals of the business.
A good manager will bring the work results of each employee in the most optimal way when there are reasonable and clear directions in the division of tasks and work. They are people who have an open communication attitude and the ability to communicate transparently. At the same time, they must be able to review and discuss the decisions of business management so that they can encourage employees to be creative and enthusiastic.
The control function includes the work that needs to be done, such as: instructing HR leaders how to operate?
The implementation of the control function will help the employees working at the enterprise work efficiently and quickly, avoiding work delays.
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Control and adjustment function in corporate governance
In the process of working, the control function will help ensure that the work is carried out according to the plan, how does the administrator monitor the operation of his business? actual performance income to compare with the target to detect and adjust if there is any deviation.
The control function on the goal as well as the operating process to achieve that goal when corporate governance needs to follow 4 steps as follows:
- Set performance standards based on goals.
- Report and measure actual performance.
- Compare the results between the target and the actual report.
- Add or add changes or precautions.
Therefore, control is the process of monitoring, measuring, evaluating, and also adjusting work activities. This function will help managers to evaluate in the most objective way, grasp the strengths, limitations, and shortcomings that still exist in the business. From there, managers will come up with adjustment methods to help their business' activities grow stronger and more successful.
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Coordination function in corporate governance
When Effective corporate governance then the ability to coordinate must be done in harmony and flexibly for the structure of the enterprise to operate better. When coordinating between departments, the most positive influence is the attitude and behavior of employees.
Therefore, the coordination function must be able to promote and maintain corporate discipline.
The management of the enterprise must demonstrate honesty and openness when linking internally to perform the best coordination function and achieve the set goals.
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Epilogue
above article, Johnson's Blog shared with readers about the functions of corporate governance, clearly analyzing each Functions of corporate governance thereby helping the reader to understand its essence.
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