Economic challenges belong to everyone

The companies take advantage of the closings of the fiscal and accounting years, to be able to evaluate their economic situation, value the evolution of the recent business, and some, elaborate budgets, with the available information, that allows to anticipate the evolution of the main magnitudes of the business in the future, at the same time as it establishes a roadmap of work and objectives, with which to be able to evaluate and to contrast the future evolution of the business.
Other companies, these smaller ones, work with business plans that allow them to draw up longer-term action plans and planning, usually between three and five years, where not only the budget information of the account is specified. losses and gains, but also detailed detailed business action plans, which allow the strategic objectives to be achieved in ten or five years of the company.

If we transfer this way of doing things from the private company to the public administrations, which are also obliged to present annual budgets, and a strategic plan should be demanded of them, in the medium term, which could be assimilated to the electoral programs. of the political parties, these should serve to account for the citizens, the percentage of fulfillment of the planned initiatives, and the degree of achievement of the pre-established objectives. Unfortunately, this private management is not transferred with the same rigor to public administrations.
On the other hand, at present it seems that this comparison is not appropriate, and we are in a conjunctural moment where it is not consistent to detect differences in the management or administration of private or public companies, but we are subject to a stage where the cooperation and co-financing of projects between the public and private spheres will be fundamental to guarantee the efficiency and the economic improvement, the circulation of the European bottoms, that allow, therefore, to take advantage of the public synergies with the private initiatives that improve the efficiency and productivity of our companies, while guaranteeing environmental sustainability and technological innovation.

In short, if the way out of the current economic crisis is to be based, in part, on public and private cooperation, I understand that the challenges of the Spanish economy should also be posed as a common challenge between the ‘private environment and the public environment. Therefore, if I share the challenges of the Spanish economy, which the Bank of Spain has detailed several times in recent months, and which can mainly be summarized between three blocks.

The first refers to the labor market, which is a structural problem, where the duality of temporary and indefinite contracts, causes great inequalities in stages of recession, with the destruction of concentrated jobs of temporary contracts, when they have a lower incentive in training and discontinuity in the workplace of workers, also limits their productivity.

Another aspect of the labor market that limits our productivity is the average qualification of both our workers and our employers. Behind this, there are other challenges in the field of education, such as the reduction of school dropouts, in the university environment the need to improve the quality of the selection of teaching staff, ensure the transfer of knowledge in society, as well as encouraging and improving continuing education also from the workplace.

Another major block for improving the economic structure is the productivity of our companies, which is partly limited by the high weight of SMEs in our business fabric, which accredit lower productivity and efficiency with respect to the larger companies. Therefore, although we like to prove that our fabric is dominated by small and medium-sized companies, and self-employed, at the same time we should prove that they have lower levels of productivity, which causes a lower generation of added value per worker. . In all crises, mergers and acquisitions of companies are observed, which make it possible to reduce costs, with economies of scale, and therefore improve efficiency to guarantee their viability or to consolidate themselves as leaders in their market, such as La Caixa with Bankia.

If we therefore share these medium-term challenges, it would be necessary to establish a joint economic plan between the private and public spheres, in order to remedy the structural deficiencies of the Spanish economy. The structural challenges of the public sector are easy to enumerate (labor market duality, improvement of all levels of education) and difficult to achieve, aggravated in the current environment of economic crisis and fiscal weakness of public finances. But, also in the private sphere, there is resistance to change, which in many cases affects the resistance to losing control of business, sacrificing productivity improvements and new growth opportunities, and therefore maintaining small business structures with lower productivity. at the same time as the data show that the level of training of workers and employers is lower than in other European economies, which potentially also has a negative impact on productivity.

Fran J. González is a Strategic Consultant at the Management Center and Secretary General of the UNED Girona


Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.