Producer profile
First of all, it must be noted that the description in this article does not apply to all producers in the region or to specific individuals.
However, there is a noticeable pattern that describes a good number of directors and owners of companies that started dealing with manufacturing from scratch. Their path to a more serious production did not come overnight – there was a lot of hard-work and sacrifice, trial and error. They have built a lucrative business and currently have approximately 15-30 employees, as well as a reasonable number of customers. All this is somehow running for now, but many will say – with a lot of stress and not enough rest.
How did they start?
Most of them chose a particular industry niche based on their previous work experience gained as employees in larger manufacturing companies. Quite a common story in the SEE region, and especially in the countries of the former Yugoslavia, was that many large industrial plants collapsed as collateral victims of political manoeuvres or out of negligence of those who have taken ownership. Our future manufacturers have thus gained some knowledge about the needs of the market and how to meet them.
Others dared to engage in manufacturing out of pure enthusiasm – they themselves needed a product that they then began to develop and produce. They saw a particular market potential and successfully fulfilled it. One could say they started in the garage, but with a lot of effort and of course, at least a little luck, they successfully built a business that now feeds not only them and their family but all their employees and their families.
Culture and organization
Directors of such manufacturing companies describe relationships within the organization as being a part of one big family. And that may be true in some cases, which can be both good and bad. A close relationship with employees creates a pleasant working atmosphere and trust, but this can lead to employees taking advantage of the director. He wants to be fair, correct and does not want to offend anyone, he does not want to be a boss he himself would not want to have. The same is true the other way around, where an overly intimate atmosphere leads to blurred boundaries between private and business life to the detriment of employees.
On the other hand, he often does not know how to motivate employees or how to manage them. Our director-producer is most often of technical profession (or at least affinity), and with running the business, there is no time to educate himself about various topics regarding organization, management, human resources, etc.
For this reason, there is often no well-established organizational foundation, nor is there any serious preparation and planning for future challenges. Business functions are occupied as needs arise. They consider the implementation of a systematic job classification a waste of time. There is no predetermined division of labor within the company into clear and separate tasks. This is also no surprise, because our producers can do a lot on their own, so they expect that from others as well. They multiply what they know into other jobs.
The problem is what they don’t know, because they believe these functions are not even relevant. As a result, some departments or functions in the company don’t exist at all or are considered nonessential. The priority is to employ workers in production because, after all, it is their core business, while most of the supporting activities are fulfilled by the director. This could result in a few versatile people in the administration without a clear division of labor and many workers in production whose output could be better.
A very important question is whether this business could function without this director? And most of them are aware that the answer is no. Everyone will agree that a company should not depend on just one person, but in reality there are too many such examples.
How do they deal with problems?
Producers are hard-working and resourceful. They have created a successful business and gained a lot of experience in the process. They have no formal education or experience in economics, they learned everything they know first-hand, in practice.
Our producer generally solves the problems in the order in which they come. He is aware that this is not ideal, but he does not have the time or knowledge to deal with extensive planning and predictions, what-if scenarios, analysis and other. This is mostly done from memory, and with enough practical experience comes a fairly reliable intuition.
Most of the problems the director tries to solve himself. With a few trusted employees who may be able to take on more complex tasks, he is still reluctant to leave the task to them. It’s not that he doesn’t trust them, but he is sure that he will be able to solve the problem better. What if something unpredictable happens? How will they manage? What if the business will suffer because of it? Delegating tasks is something they reluctantly agree to.
Lack of trust in employees, as well as inefficient organization and poorly defined functions and processes lead to a situation that, fragile like a house of cards, cannot respond resiliently and adaptably to any major business challenge or market change.
In the second part of the article we will focus on specific issues that manufacturing company directors most often complain about.