Estimated time of the topic : 30 minutes
Organization or institution, designed, created and constituted by a person or group of people, that is dedicated to specific economic activities to achieve objectives that later become into benefits. To define what a company is, it is essential to mention the products, goods and services that it offers its customers and for which it profits. Next, we will see the company as an open system.
The company being a system we can identify within it different interrelated subsystems. The division can be made in 3 subsystems that help to understand its operation:
It includes the functions of supply, production and marketing, that is, the collection of productive factors that will be transformed to obtain a product that will be distributed in the market.
It’s in charge of the management of financial resources. Its relationship with the real subsystem is very close, on the one hand it provides the resources for its operation (purchase of raw materials, maintenance of machinery, marketing expenses, etc.) and on the other hand it receives the income derived from sales.
It frames the functions of planning, organization, direction and control; being its primary objective the decision making to achieve the objectives of the company. The other subsystems leverage and feed the latter which, in turn, will be in charge of implementing the approved decisions.