Issues in Improving the Economic Training of Enterprise Management Personnel

G. V. Simonov, A. S. Berdnik

(Presented by the scientific seminar of the Department of Industrial Economics and Enterprise Organization)

In his report to the XXIV Congress of the CPSU, A. N. Kosygin said: “The question of management personnel requires constant attention. We face the task of consistently expanding and improving the system of training and retraining management personnel at all levels”¹.

The resolution of the Central Committee of the CPSU “On Improving the Economic Education of Working People” notes that some managers have a poor command of the skills of economic analysis and are unable to substantiate the effectiveness of the decisions they make.

As is known, the foundations of economic knowledge among management personnel are laid in higher and secondary specialized educational institutions. However, practical skills in the field of economic methods of production management are not formed there.

Moreover, as a survey conducted at a number of Tomsk enterprises has shown, many middle- and lower-level managers do not have specialized technical education.

Let us consider this in more detail using the example of the Tomsk Tool Plant, founded during the years of the Patriotic War on the basis of the evacuated Frezer plant. In recent years the plant has steadily held the transferable Red Banner and has occupied first-class first place in the All-Union socialist competition in the tool industry. It has been awarded the Jubilee Badge of Honor.

Who, then, manages the production subdivisions of this leading enterprise?

The structure of management personnel by education and length of service is characterized by the data given in Table 1.

It can be seen from the table that 33% of managers have higher technical education, 1% have higher economic education, and 30% have secondary technical education.

Thirty-six percent of managers in the middle and lower levels of management have no specialized education; in practice, this means: 14% of chiefs and deputy chiefs of the main shops; 33% of chiefs and deputy chiefs of auxiliary shops; 8% of chiefs and deputy chiefs of functional departments; and 53% of senior foremen and foremen.

Structure of managerial personnel by education and length of service

Table 1

Number of workers relative to the total number in the corresponding category, %

In terms of length of managerial service, the plant’s management staff is characterized by the following data:

At the same time, 28% of the managers have a total length of service of from 10 to 20 years; 58%—over 20 years.

As the survey showed, at this plant over the last 5 years (from 1968 to 1972) only 23% of managerial personnel improved their qualifications away from production. In the absolute majority of cases these were managers without the corresponding education, sent for 2–3-week course training in Novosibirsk, Gorky, Moscow, and other cities.

What, then, is the reason for the stable economic performance indicators of this seemingly insufficiently educated collective of managers?

Above all, it lies in the fact that the entire management apparatus, under the personal leadership of the plant director, Comrade L. D. Budnitsky, conducts a persistent, systematic search for and uses the internal reserves of production. This work is carried out through an economic seminar for shop heads and deputy shop heads and for functional departments, which at the plant has been turned into a permanently operating economic conference under the director. The director exercises individual control over the economic training of managerial personnel.

In the classes, production problems are solved that are based on concrete situations at this enterprise. The decisions adopted by the participants are formalized by order for the plant or are included in the plan of organizational and technical measures.

The classes are conducted by qualified economists of the plant and of the higher educational institutions of Tomsk.

The work of this seminar has its own considerable difficulties, its own problems, but the main thing is that the collective of production organizers conducts a persistent, purposeful search for opportunities to further increase production efficiency.

Life suggests that in the nearest foreseeable period the training of personnel for the middle and lower levels of management will be carried out according to the traditional so-called “experience-and-intuition” system, or by the method of “learning from mistakes.” Since at the present stage of economic development precisely this contingent is solving the most important task of the time—raising production efficiency—the system of its formation requires no less close attention than the new state system for training managerial personnel.

Taking into account the fact that, first, the training and upgrading of managers is not an end in itself, but only one of the means for the further intensification of production, and, second, that the new state system for training organizers of production is itself practically still at the stage of formation (its throughput capacity is extremely small and for the time being is oriented toward training the higher apparatus of production management), in our opinion it is necessary to introduce, as a component part of the state system, a plant-based form of training managers of the middle and lower levels of production management. For this it is necessary to review the forms and methods of plant-based economic universal education for managerial and engineering-technical personnel. The economic education of workers in these categories must not only

be carried out continuously, but most importantly, it must find active expression in production. Purposeful factory-based training as an organic part of the process of forming managerial personnel, in combination with the experience of specific production activity, will supplement and enrich it.

The factory form of training managers, combining current and long-term plans for instruction both with and without release from production duties, will make it possible to ensure reliable “output control” when appointing personnel to managerial positions and sending them to centralized courses and faculties of advanced training.

Experience suggests that the most acceptable form of factory-based training for managerial staff may be differentiated, staged courses designed for 3–5 years of study without release from production duties. At the same time, the individual curricula of course participants should fit into the periods and timing of advanced training with release from production duties.

Purposeful course instruction under specific production conditions will make it possible, on the one hand, to ensure strictly individual ongoing monitoring of each participant’s progress, with subsequent certification based on the results of the economic and academic year; and, on the other hand, to create conditions for a well-founded assessment of the level of management and of managerial ability on the basis of a set of indicators that take into account the specific character of the work of the person being certified.

For example, in certifying a shop chief, such indicators as labor productivity, return on fixed assets, shop cost, the ratio of growth rates of labor productivity and wages, and others may be taken into account. Comparing the achieved level of the most important indicators of production activity with their normative values over time will make it possible to assess more fully and accurately the level of management and the quality of the courses. The results of certification will help to differentiate official salaries and current incentives for managerial and engineering-technical personnel.

The foundation of in-plant training for managerial and engineering-technical personnel should be: for all engineering and technical personnel, mastery of comprehensive economic analysis of current production situations; for managers of production subdivisions, in addition, practical mastery of the systems approach to making managerial decisions.

The main reason for the economic insufficiency of technical decisions is that the analysis of economic activity is usually performed only by the enterprise’s financial and economic services. This significantly limits the possibilities for identifying internal production reserves.

Economic training for managerial and engineering-technical personnel must be reinforced by effective measures to improve the production-performance indicators of the subdivisions they manage.

Practical activity should serve as a test of the suitability of the knowledge acquired, confirm the expediency of the training, and help accumulate skills in applying economic knowledge. Of course, the transition to targeted economic training of managerial and engineering-technical personnel will not, by itself, improve the economic indicators of production. This is a complex, multifactorial problem. But one thing is indisputable: purposeful and well-organized economic training of personnel is a most important factor in increasing production efficiency. In order to ensure interaction

economic study and the practical activity of production organizers, it is necessary to answer one of the most difficult questions: “How should managers be taught?”

The existing system of universal economic education, based primarily on the traditional lecture-and-seminar method of instruction, is oriented mainly toward forming in managers a broad economic outlook. In answering the question “What is to be done?”, it solves this task and yields high “gross” indicators of economic knowledge. However, if, from the standpoint of the present day, the targets are shifted from “gross output” to the “implementation of economic knowledge,” it becomes clear that improving universal economic education requires an answer above all to the question: “How should managers be taught the skills of economic management of production?” Traditional methods of instruction do not provide an answer to this question.

In our view, the most promising method from the standpoint of forming the skills of a systems approach to the adoption of managerial decisions is a method of instruction that combines general economic theory with the solution of production problems constructed on the basis of specific situations at the given enterprise. This method is widely used in the Higher Advanced-Training Courses of the USSR State Committee for Labor. Its application under the conditions of universal economic education comes down to the following types of educational work.

1. Reading lectures on general and specific economic theory, analysis of economic activity, scientific organization of labor, and management. The task of the lecture is to provide an orienting framework for a systems approach to the analysis of a specific production situation and the subsequent adoption of a managerial decision (30–40% of the course program).

2. Identification of economic, organizational-technical, and socio-psychological problems, and their independent study in the shops and departments where the participants in the economic courses work.

3. Analysis and classification of problems, and selection of the most urgent among them as subjects for future investigation in course work.

4. Conducting individual consultations on the methodology for accumulating, analyzing, and classifying primary production information.

5. Conducting research; processing, analysis, and generalization of data.

6. Formulation of production tasks and their classification.

7. Study of advanced experience.

8. Economic instruction on the example of production tasks (holding production discussions).

9. Adoption of a final decision, preparation for implementation, and implementation in production.

10. Analysis of the effectiveness of the implemented decisions. During the period of study in the courses, interim and final certification of participants is carried out on the basis of the results of production activity and instructional sessions. The appropriate certificates are issued.

The method of instruction using the example of specific production tasks without interrupting production has a number of advantages.

1. It makes it possible actively to form the manager in the production environment that is natural for him.

2. In combination with an off-site form of instruction, it makes it possible continuously to raise the level of management of a specific production subdivision.

3. It provides current individual control and a substantiated final assessment of the quality of instruction through periodic certification.

1. It creates the prerequisites for the successful selection of candidates for assignment to courses and the Faculty for Advanced Training, as well as for incentive measures that take personal contribution into account.

2. It provides broad opportunities for the prompt implementation of managerial decisions aimed at increasing production efficiency.

3. It makes it possible to identify gaps in knowledge, refine programs, and draw up individual plans for supplementary classes.

4. It requires practically no expenditures, since all training is built on the enterprise’s production and instructional base.

The successful mastery of active methods of training without interrupting production requires great joint efforts on the part of the enterprise administration and the instructors conducting the classes in overcoming a number of problems and difficulties, such as:

overcoming the inertia of traditional teaching methods and forming in trainees an active attitude toward learning;

the wide range of initial levels of education and work experience;

organizing individual consultations on methods of collecting primary information, processing it, systematizing it, and presenting it;

the absence of qualified instructors;

a shortage of instructional time;

a lack of methodological literature and information on advanced experience, etc.

We proceed from the obvious truth that the improvement of the economic training of managerial personnel must meet the requirements of the present day. It must be directed toward solving the practical tasks of our time. This is a creative, dynamic process requiring the centralization and coordination of actions.

1. Materials of the XXIV Congress of the CPSU. Politizdat, 1971, p. 175. ↩