• Companies should implement coaching programs for management education.
• Companies most often do the mistake of considering themselves smarter than the market

The Consultant Joseph Vogel:

Management here is like management in the EU 5 years ago.

Where do you think Bulgarian companies meet problems in their development?
Companies should learn to analyze their activity and organize their work based on this analysis. This is one of the things we are trying to do here - to prepare Bulgarian managers to meet the market needs. The executives should not only possess knowledge and skills in the technical or manufacturing field, but also to have good managerial skills and to develop them constantly. However, we have the same troubles in America, where we should make managers understand how important is it for them to be good leaders as well.

Do you have observations on the European market and the Bulgarian position on it?
I have the feeling that your country is today where Hungary, Czech Republic and Slovakia were 5-10 years ago. But companies in some sectors here develop very well, and I am impressed by the advance of the companies in the high-tech industry. To my opinion, they can successfully compete on the international theatre.

What is the relation between the HR strategy and the business strategy of a company?
The main goal of the HR strategy is to support the general activity of the company. If you don't know, however, what is your corporate strategy, you would not have a good strategy for human resource management. It should be crystal clear what you intend to do, so you will know what kind of people you would need. Besides, the task of the Human Resource Department is to identify resources within the company - managerial, technological and scientifically, so the goals of the company can be achieved. It is very important in an economical environment like yours to implement coaching /mentoring/ programs for managerial education. Often, companies do not take responsibility for development of their employees. At the moment, in the dynamic business environment they are relying more on technical skills.

What is your approach when you have to consult a company?
First of all, a base for good dialog should be established. Often, when consultants are making a proposal they say" I have an idea on how to change things…", but they get in response "That is not the way we do it here"… and that's where you loose ground for a good dialog. What is appropriate in this situation is to sit around the table, put all the arguments for and against the different approaches and to find the best solution for action. On the second place, it should be made clear what the expectations are. I cannot simply go to the manager and claim I want to change things overnight. Even when I get involved in crisis management I do not resort to emergency actions.

Tell us some particular example of a crisis management project you were involved in?
We were working for an American company which had over 50 million in the bank. The company was having huge costs and lost and for couple of months it spent all the resources. It was operating on the telecommunications market and was offering a complex product on a sophisticated market. In 2001 the company got in a difficult position, the clients pulled back and there was no market for the products anymore. That is why we were hired. Initially we talked to all employees in the company, with the clients, the experts in the industry, the suppliers and so on. We finally came to the conclusion that we need to reduce the number of employees from 250 to 120. The company had shifted from its initial strategy, and we had to take it back there. We optimized the production process and eliminated all activities which do not bring profit. For example, the company was providing some services for its clients free of charge, and this had to be changed. We told the clients that they should start paying, although they did not like it much. After that our plan was to merge the activity of the company with another one and we made it. At the moment this company exists under a different name. In this process we had to define what kind of people we need and at what position. It was important to eliminate employees, who did not perform sufficiently.

Is there any general principle that you follow when you have to deal with a crisis situation?
What we do each time is to understand what is happening and to make assessment of the situation. After that we need to answer the question of what should be changed in the company so it can get back to its market position and what should be its structure in order to meet these requirements. And, yes of course, we look at the development plans and the marketing plans. It is very important that everyone in the company shares its mission and goals and understand the importance of their work to the overall performance. I will give you an example. In a company, for which I used to work, the marketing team had not defined the direction of development generally. If we have to be honest, at that time the market was changing rapidly, and if one day we were having specific target group, the next day it was totally different. It was extremely important for us to know where we are on the market, as the sales up to this moment were aimed at the wrong people. Then at a meeting with the executive team, one of the marketing managers stood up and easily claimed that we need to change totally the whole technological platform of the company. I tried to show him that he is thinking in a wrong direction, but he would not listen. Then I said that we will not do this and we will keep the same course we have taken. We should not have to spend our resources on the development of new technologies. He was an excellent marketer, but he never understood how exactly to help this company.

What are the most often repeated mistakes that managers do?
Managers often think that they are smarter than the market. Even if they are very clever, they can make the mistake of releasing a product for which the market is not ready yet. Hat is what Apple did when in the beginning of the 90's they developed a project for a new product, which suffered a great failure. Only five years after that the same concept found a successful implementation, but the market was ready.

Interview taken by: Zornitsa Markova