The organization of private economy of Kosova in terms of creating a private business community, which would articulate its interests in an organized way, has no tradition. The Association of Businessmen of Kosova (ABK) was established in May 1997 and because of difficult working conditions, it has not been able to realize its programmed orientations. Particularly, the activity of ABK for the development of forms for business education would be of great importance, for providing with necessary information from the domain of legislation and marketing, in cooperation with scientific and professional institutions and in the creation of channels for lobbying and positive impact in state institutions. Through this association, relationships with other regional, European and world entrepreneurship associations must be established in order to benefit from their experience as well as to receive technical assistance from international organizations and institutions. The organization and cooperation of private enterprises according to certain spheres of interest is not evident. The certain institutional government network does not support a better organization of private economy, while NGOs haven’t developed yet. So, the supporting forms from investing and warranting funds are missing as well as consulting services, services for performing certain functions for private enterprises, etc. Internal organization of private enterprises faces also too many difficulties expressed on a low level of partnership, in engaging abilities and training of personnel, its inadequate selection, weaknesses in developing of management and marketing functions.
Partnership Development
For the level of partnership development, the poll shows that a general characteristic of polled enterprises is that they are founded without previous market analyses and studies and without determination of long-term strategy, which reflects itself in the question from the questionnaire: "What was the motive for registration of the enterprise?", where from 300 polled enterprises, 184 responded with: "The reason of unemployment", whereas only 64 responded: "with previous concept and project" and 52 "for other motives". These data set out the way of founding of enterprises. As for the number of founders, from 300 enterprises, 230 are personal (family) enterprises. This also shows that the founders fear and have no complete trust in partnership enterprises. From the responses in the question:" If the number of founders is more than one, what is the relationship among them?", the most frequent response was "Family relationships"(this also fits with the estimation that enterprises belong to family business).
The question "What are the main reasons for partnership neglect in Kosova?" is very interesting with a variety of answers. According to the frequency of answers, it emerges that the major proportion has "the lack of tradition", but "distrust among the founders" and "actual situation’ show that in private initiative still is some empty space for development of partnership in private economy. "The contract had too many ambiguities" is mainly a consequence of the lack of sufficient legislative arrangements, the absence of professional institutions for juridical assistance in formulating the contract relationships. According to the analysis of questions 13 and 14: "Have you ever had contests with your partner-cofounder?" and "How did it end up?", we can see that in 33% of all cases, problems were overcome "by reconciliation", 67% with "the parting of partners", "quitting by one of the partners", "with dissolution of enterprise", "the founding of new enterprises".
From the total number of all contests, we can notice that when partners usually come to a conflict, the contest ends up with negative consequences for the continuation of partnership. As for the question: "What form of the organization does the enterprise have?", derive interesting responses.
Mixed enterprises possess assets in both social/state and private ownership. From 300 polled enterprises only four of them were declared as stock companies. But, in Kosova still no enterprise has been formed in private sector on the bases of stocks (shares) emission, for selling for founding an enterprise or for expanding capacities’ activity. This means a registering declaration as stock company and not founding by usual procedure for founding of a stock company.
The form of organization
The form of organization of the registration of companies without limited responsibility, (194 from 300 polled), shows a lack of knowledge for economic consequences for the status of this kind of enterprise, although legislator has not foreseen the obligation for companies without limited responsibility. This neglect, Serbian state authorities have used in an unlawful way for arbitrary taxing of founders, which has nothing to do with the taxing logic. Enterprises in private sector in Kosova have a very simple organizational structure, with incomplete professional services, especially for market research, marketing etc. But they represent the first nucleus, very modest but sound of establishing entrepreneurship economy with developing pretensions.
The poll analysis sets out that elements of traditionalism in founding, managing and in development planning prevail. In terms of joining together of partners, professional motives participate only with 22%, whereas the founders with superior education participate with 33.2%. The managerial and the ownership’s function are not separated. The structure of ownership and traditional mentality become an obstacle for implementation of up-to-date management concepts. Consequently, the professional basis of managers in enterprises is low, as illustrated by these facts:
Business ethics
In evaluating aspects of Kosovarian business ethics, it must be taken into account that Kosovarian society has experienced huge social and economic changes for a relatively short time (one hundred years), passing from an almost feudal formation, through socialist, till today’s specific conditions of a kind of market economy. It is clear that also the business (conditionally called so) in Kosova, in these conditions has faced big changes in form and content. Dominating moral norms, which followed such a business in Kosova, (excluding considerably the well-known socialist moral, which lasted for a half a century), were codified and regulated also with traditional elements.
Today’s business in Kosova is developing in two business areas:
"Social" business develops in the circumstances of total occupation of state enterprises and of total discrimination of a small number of Albanians still working in them, so that it is impossible to talk about business ethics in the meaning it has in developed and civilized world.
For the business ethics in the private business of Kosova, which develops more or less in free market conditions, there is no elaborated study. As the only source in this aspect can serve this year’s poll done by "Riinvest" of Prishtina, although the poll was not conceptuated for the reason of complete study of ethic aspects in our business.
As seen, the dominating norm for founding an enterprise together with other partners is the trust for the other. The percentage of contests among the partners is relatively small for existing circumstances of business in conditions of Serb colonization, while the regulation of relationships and of contests is done by mutual agreement. These facts clarify that the spirit of present kosovar business is characterized by relatively high ethic norms, despite difficulties of business imposed by existing socio-economic environment.
The data for the relation enterprise-government (actual Serbian power), explain about a colonialist approach of Serbian power against Albanian entrepreneurs and present Kosovarian business. "Very frequent control" of Albanian business, their performance with the intention of plundering for the Serb power interests and for personal profits of Serbian "controllers" as well as very high punishments, which Albanian businessmen must pay (6.548 DM per control).
Personnel in private enterprises
3. Qualifying structure of personnel in private enterprises in Kosova bears some phenomena, which are barriers for development. By this is primarily meant the recounting of personnel, which is mostly from close family relationship, inadequate education system, disability of gaining experience of this personnel for advancement intention, training and qualifying with the intention of requalification and adopting to the needs of market economy.
Qualifying structure of personnel in private enterprises is conditioned by their activity and by conditions in which they perform their activity. If we observe qualifying structure of founders-owners in 300 polled private enterprises in Kosova, we can say that it is relatively satisfactory. This conclusion relies on formal level of education rather than on professional education and managerial level for managing of enterprise. Qualifying structure of founders of 300 polled enterprises is shown in the table below:
The relation between founders and managers in enterprise is reflected by these data:
Qualifying structure of personnel in 300 polled private enterprises is depicted in the following table:
The proportion of low professional education in the total number of the employed is 14.3%. Secondary education is 60%, high – 11.4% and superior – 14.2%. The analysis of the number of employed shows that enterprises that employ less than 20 employees are dominating (93%).
The ways recruting the personnel in polled enterprises is not satisfactory. This is mostly a consequence of the social and economic situation. In only about 12% of cases the form of competitive examination is applied in order to select the best personnel. 88% of enterprises apply other less effective forms. From the responses taken by the poll, only 16% of enterprises respect the qualification and the abilities of candidates, whereas 84% of enterprises employ mainly their family members.The average salary in polled enterprises were 311 DM.
Qualification of personnel in present conditions is mainly done through education, while a small number develop these abilities through the experience in enterprise. The enabling of managers, businessmen, is mainly formal-through education. Training and business education institutions are lacking. Only 18% of enterprises have practiced sending of personnel in informative seminars from time to time about legislation changes.
Marketing function
4. As a consequence of weaknesses in organization and in qualifying of personnel, many problems in organization of marketing function occur.
Very often enterprises base their business activity on the classical concept of selling, which means that they start from existing product, whereas the concept of marketing must have the consumer in focus of business policy.
As for regular market research, 71.3% of enterprises have given negative answers. Enterprises that make market research, 96.7% of them do these research by themselves, relying on intuition and in informal methods (through conversations with business partners, friends etc.). The number of products in terms of assortment of production in commercial enterprises is higher than 100 products, which is a sign that there is no specialization. In manufacturing enterprises prevail enterprises with 1-3 products,(42.7%). Most of enterprises (93%) do not use bar code for their products.
The most frequent method used for product pricing is that based on competition (58.7%). This means that enterprises lack an independent and active policy for their product pricing. Most of enterprises do the distribution directly (65.3%). About 52.3% of enterprises have depots, while 60.7% possess also stores for retail sales. This means that private enterprises use various distribution channels. Only 8.0% of private enterprises use continuously advertisement media. The press prevails as advertisement medium with 87.6%. Advertising and representing means participate with 66.0%.
The determination of advertisement budget, Kosova's enterprises do mainly according to their financial capabilities (43.3%).
Enterprises ignore the influence of market conditions as well as the importance advertisement has for enterprise’s business. Almost 75.0% of enterprises make no evaluation of advertising effects at all.