This firet learning module of Organization and Management for Senior High School students is designed to provide leamers with a better understanding of the basic concepts of mansgement and lis theories. in this module, the students are able to apply management theorles and concepts in solving business and organizational issues and cases, explain the meaning, functions, types and theories of management through various activities, which enable the learners to put into praclice all the things which are mentioned here. After studying this module, you will be able to: 1. Describe and discuss the meaning of management, 2, Identify and explain the functions of management; and 3, Identify the various types and theorles of management. THINGS TO REMEMBER TO GET THROUGH To learn and benefit from this module, follow the following steps: 4. Read the module title and the module introduction to get an idea of what the module covers. Specifically, read the first two sections of this module carefully. The first section fells you what thls module is all about while the second section tells you of what you are expected to learn. 2. Never move on to the next page unless you have done what you are expected to do inthe previous page. Before you start each lesson, read first tha INSTRUCTIONS. 3. Work on the activities. Take note of ihe skills that cach activity is helping est afer you are done with all the lessons and activities In the module.SOMEBODY got angry about that, And EVERYBODY was asked to do it EVERYBODY was sure SOMEBODY would do it. ANYBODY could have done it, but NOBODY did it. because it was EVERYBODY’s job, EVERYBODY thought ANYBODY could do it bul NOBODY realized That EVERYBODY would not do it. itended up that EVERYBODY Blamed SOMEBODY when NOBODY did What ANYBODY could have done. "Delivering Desired Results On Time At Least Cost” What is Management? Management has been defined in many ways. It represents both a function and the people who execute, perform and manipulate resources. It also signifies authority, duty, responsibility and accountability. Management is also known as the process of getting things done through others. It is also a process of coordination and to oversee the work performance of the People working together in accomplishing the organization's desired goals and objectives. i Management is the process of achieving the organizational goals and objectives done by the people with the use of other means of resources and functions, such as n o the following: . Planning is the process of determining organization's goals and objectives and deci will do ing in advance on what to do, how to do it, when to d 1 5 5 lo and who including the how to measure and evaluate the performance Organizing is the process of positioning an organizatio ar Se : nai sir assigning task and coordinating harmonious relations among the ina a and teams in the organization. el . Staffing is the process of putting the right person in the right position meaning it begins in recruitment, placement, training and develo; personnel. Ere nt Ot |. Leading is directing, influencing and motivating the subordinates to do their task-related activities according to ‘their full potential in the organization, a5. Controlling is the process of monitoring and evaluating performance of individuals or work groups to see that they conform to the set plans and correcting deviations or imperfections. ZA Tunctions of Management Figure 1.1 Fundamentals to the Nature of Management; Coordination, Efficiency, and Effectiveness: Management functions are essentials in order to accomplish the management Process of harmonizing, coordinating and overseeing the entire work performance of the people working together in an organization, These functions are useless if Coordination, efficiency, and effectiveness are not observed andl practiced by the people in the organization. Figure 1.1 above shows the system of coordination in the form of human body which depicts inlerclependency and unity of purpose ‘one is useless without the other” as basic and concept of organization and management. Unily of Purpose means ihat goals and objectives may only be achieved with the sooperation and coordination of the people in the organization and the delivery of quality outputs on time al least cost, Coordination is the integration, unification, synchronization of the effort of the department to provide unity of action for pursuing common goals, A Bree that ee el the other functions of management. (© ‘ J)lo What is the difference between Effectiveness and Efficiency? talk about management. Yet, the; terms are commonly used when we , they are Beh misused and misinterpreted. Now, let's define these terms, Effectiveness is simply doing the right thing or accomplishing 8 purpose; producing the intended or-expected results while efficiency Is performing the best Possiblg manner with the least waste of time and efforts or simply saying “doing things right". (www. insighisquared.com) THEORIES OF MANAGEMENT Management theories are collection of ideas and concepts from different gurus of management that recommend the general rules on how to manage an organization or business. Studying management theories will help people understand the management practice on what, how, and why some organizations would succeed and some oryanizations failed. Understanding and performing the besi practices from different management theories may help workers to be more effective and efficient in guiding the organization to succeed. it is belleved that these theories gave rise to the leadership approaches commonly used to guide and grow the present organizations and they can really choose from the identified strategies that will work best for them. Performing and applying management theories may take time. The management theories are the following: 1. Scientific Management Theory This management theory was developed by Frederick W. Taylor (1856-191 5). He was the founding father of organizational study and known as the Father of Scientific Management. His theory uses the step by siep, scientific methads for finding the single best way for doing a job. His scientific approach has an enormous effect to the people in a corporate world including the academe. Frederick W. Taylor was a mectianical engineer and management consuliant. He wanted to make an organization more standardized, efficient and productive by Studying their work process carefully and systematically at the micro level to speed up work. This scientifi management Is also known as Taylorism. : You may click the link below to enhance your learning https:/Avw. youtube. com/watch ?v=y! Process in this lesso| INFY_AHG-MU me 2. Principles of Administrative Management Theory The Principles of Administrative Management Theory focus on the ad, or managerial functions and How to implement the good managemen} mo organization. Henri Fayol (1841-1925) a senior executive and tining : developed this theory when he evaluated an organization through th, istrative Ice in the engineer, © Perspective ofcorporate level where the managers and situations enco leaders had six main functions - to forecast, plan, Seen arent acs eonan and he developed principles that outlined how leaders should organize and interact with their teams. He suggested that the principles should not be rigid but that it should be left up to the manager to determine how they use them to manage efficiently and effectively. Henri Fayol outlined his principles as follows: Initiative: This refers to a personal quality of employ ordered. Equity: This is called the “principle of equal treatment” which suggests that everyone in the organization should be treated equally and live in an environment of kindness. ‘Scalar chain: This is a “principle of chain of command’ that says there should be a communication process from the top level of management to the lower level Y ‘or communication generally flows from top to bottom. Remuneration of personnel: This principle refers to the monetary and non- monetary remuneration based on the quality of performance levels in an organization. i Unity of direction: This is a principle of one team-one goal. ; Discipline: Employees should observe the culture of discipline inside the organization through respect and obedience of the policies, rules and regulations. Division of work: This is the principle of synergy. Employees should be given responsibilities based on their skills and interests to make them more effective an¢ efficient. Authority and responsibility: There must be a balance between authority, the right to give commands and make decisions and the responsibility which is the obligation of an employee to perform the tasks assigned. Unity of command: Employees must get orders from one immediate supervisor and be accountable to that person only. Subordination of individual interest to general interests: There must be harmony between the interests of the individual and the organization. Personal I mission and vision of employees must be aligned to the mission and vision of the organization. Centralization: The topmost level of authority should be centralized to the top level of management, who has the power to make the most important decisions in an organization. is © Order: Square peg in a square hole. This means that the right man must be in the right job and that every material and employee should be given a proper place. . Stability of tenure: Employees must have job security ‘to be efficient. + Espirit de corps: Principle of Cohesiveness states that there must be a unified team contribution and cooperation among the employees. For Blended Learning: nat Jow to enhance your leaming process in this lesson: You may click the link be! utube.com/watch?v=90qpziPNRnY https:/Avww. youWHAT I NEED To KNOW This second learning module of Organization and Man: " agement fc School students is designed to provide leamers with @ bet eee ler unders basic concepts of management and its theories, sancig ofthe In this module, the students are able to a concepts in solving business and organizatio meaning, functions, roles and skills of manag enable the leamers to put into practice all the thi ipply functions of management and nal issues and Cases, explain the ers through various activities, which ings which are mentioned here. After studying this module, you will be able to: 1, Describe and discuss the managerial levels of organization; 2. Identify and explain the functions and Toles of manager; and 3. Identify the various skills of a manager, To leam and benefit fram this module, follow the following steps: 8. Read the module title and the module introduction to get an idea of what the module covers. Specifically, read the first two sections of this module carefully. The first section tells you what this module is all about while the Second section tells you of what you are expected to learn. 9. Never move on to the next page unless you have dane what you are expected to do in the previous page. Before you start each lesson, read first the INSTRUCTIONS. 10.Work on the activities. Take note of the skills that each activity is helping you to develop. 11.Take the Asoseomeneren after you are done with all the lessons and activities in the module. 12.Meet with your teacher. Ask hinvher about any difficulty or confusion you have encountered in this module. 33“Driving the wheel to the right direction” What is a Manager? He/she is the one who plans, organizes, leads, and controls the people in the process of achieving the goals and objectives of an organization. In other words, a manager is the one who performs the basic functions of management. Managers are called executives just like the president, administrator, department head and a team leader who has the power or an administrative authority in the organization. The manager is the person who is responsible in achieving the goals and objectives of an organization. He is like a captain of a ship that has an authority to give command and to delegate the necessary tasks to the right crew members in orderto have a good, sustainable and safe travel. The captain has a great responsibility towards his people-crews and the ship. He is responsible of bringing the ship in the Tight direction and destination. Thus, the ship will represent the organization. The destination is the goal and objectives while the crew members are the subordinates, During the navigation, the captain will monitor, direct and supervise his people and assume responsibility for its performance. The success of the expedition or of the arrival of the ship in the harbor is not only credited to the captain but is also the success of the people behind The manager is also responsible of the economic activities of the organization through proper allocation and wise utilization of resources; namely, manpower, money, machine, material and methods. These resources are significant factors in an organizational development in nation building The Levels of Managers There are different levels of managers according to the size of the Organization. Usually, in a small organization, there is only one manager who performs all the managerial roles and functions. Let us femember that there is what we call categories of business organization according to size like the following: 1. small Organization © Medium Organization and 3: Large Organization. In an organizatio 2. corporations, they normally have three levels of managers: the top or of management, the middle management and the lower management. IN, Such as big executive levelTop Managers Middle Managers Lower/Front line (vianagers Figure 4 Levels of Managers. Top/Executive Level Managers are also called “Corporate Managers”. They are responsible in setting policies and general direction which includes controlling resources and overseeing the over-all performance of an organization. The top managers normally hold titles such as Chief Executive Officers, Chairman, President, and Vice-Presidents (VP's). The Middle Managers (Tactical Managers) are responsible for implementation and execution of the organizational plans to accomplish the goal and objectives of the organization. These managers perform at the middle as the bridge between the top level and low level of management. Usually, they are operation managers and branch heads or managers. The Lower Level Managers (Operational Managers) are called “Front liners’, the front line managers who focus on controlling and directing. They are responsible for spearheading, motivating, directing and leading employees In their daify tasks to promote better performance of the organization. Types of Managerial skills Delivering desired results on time at least cost is the essence of management and it can be translated to the effective and efficient performance of management functions. However, this can be possible if the manager Is competent and well equipped with the essential skills or managerial skills such a8 the following: 1. Conceptual Skills — It is the ability of the manager to identify, analyze and ae complex problem in the organization. itis also the cognitive or mental eapacily of the manager to perform the following: * a. Identify cause of problems and oe b. Gather and interpret information and data; r ©. Doan bel aerate through SWOT and PESTLE alg d. Perform case study and problem solving and 1 on altemative course of actions which is beneficial to organ ‘ 3q2. Technical Skills- It refers to the capacity to use specialized knowledge and particular expertise in performing the task through the use of specific tools ang techniques. For example, 2 manager can be expected to have knowledge in Information Technology, knowledge in accounting to interpret financial information and otner technical works in an organization. 3. Human Skills- It is the abilities of the manager to work and relate well with people in an organization, ‘communicating, motivating, Jeading and inspiring the people to do ordinary things to extra-ordinary ones. Note that the application of these managerial skills will depend on the category and levels of management. Figure 2 below shows the pyramid of the comparative hierarchy of managerial levels and skills. It indicates that the lower manager has more technical skills and less need of conceptual skills compared 10 top level managers who have more conceptual skills and less technical skills in the performance of work. However, they have the same degree of human skills. Human Skills are essentials for a manager to become effective in dealing with his/her people. Managers in this level should be effective in communication whether oral or written, possessing and creating positive attitude and good vibes in motivating other people in the workplace. Levels of Conceptual Skills Manager Managerial Skills Figure 2 Comparative hierarchy of managerial levels and managerial SkillsThe Roles of Manager The main role of the manager is to le: ie ‘ ce ad hi department in accomplishing its goals and chee ee unit, team and responsibilty of the organization and functions inthe aiecang manager wil take fe the following: S and categories tke 4. Interpersonal Roles ~ These roles are usuall with his people. These include: lV used wien a manager interacts a, Figurehead — it means that he performs I ft as the symbol organization. His words are @ ave enite Fens xpected to be heard and followed by his . Leader— The manager is expecied to be a good leader whose is to motivate his subordinate to do thi extraordinary. eae c, Liaison- The manager makes linkages with ir i x People in and organization. He is expected to perform and fate connate ae stakeholders of the organization and community. a Fesponsibility ve something 2, Information Roles- The manager is updated of the things around like news, information, political and economic trends which are vital to his decision-making task. He is also considered as coach and mentor, If he wants his people to be more competent and knowledgeable, then he must provide Information for them to be updated also, In this category, the manager assumes three (3) specific roles; namely: 2.4, Monitor- It refers to the gathering of information that will be useful in performing a task or job. 2.2. Disseminator = It refers to relaying the information to others. As information disseminator, the manager should consider the veracity and relevance of the information to the work and needs of the people. 2.3. Spokesperson- The manager transfers or transmits the gathered information to the outsiders when they need It. 3. Decision Roles- It is the manager's call to make decisions as part of his/her duties and responsibilities. It is also concemed with the allocation of resources to reach the organizational goal and objactives. As a decision-maker, the manager assumes the following roles: = 3.1. Entrepreneur — The manager should identify new eas and Innovation to bring about opportunities and positive change. 3.2. Disturbance Hanaler/or Negotiator - The manager is expected to respond to such unwelcome pressures by formulating oe aS reviewing such disturbance. Negotiator will always Gefen organization's interest. 3.3. Resource Allocator - The role of @ manager in allocate resources of all kinds such as manpower, materials and methods. this category Is to money, machine, For Blended Leen 3 in this lesson: ‘You may click the link below to enhance your learn! https. //anwv.youtube.com/vatch7V=5q2CB 69 1¥5WHAT INEED To KNow This third learning module of Organization a school students is designed to provide leamers wi basic concepts of Management and ils theories, nd Management for Sertior High iit a better understanding of the In this module, the students are abe to appl z : e ly functions of manage; concepts in solving business and organizational issues and cases, lonen a meaning of environmental forces and environmental ‘Scanning, which enable the learners to put into practice all the things which are mentioned hore ‘ After studying this module, you wii be able to: 1. Identify the forces and elements in business-firm environment using SWOT analysis; 2, Identify the environment of local and intemational business firm; and 3. Describe the role of business towards the economy, the differant phases of economic development, and differentiate the various forms of business organizations. THINGS TO REMEMBER TO GET THROUGH To learn and benefit from this module, follow the following steps: 22.Read the module title and the module introduction to get an idea of what the module covers, Specifically, read the first two sections of this module carefully. The first section tells you what this module is all about while the second section tells you of what you are expected to leam. 23.Never move on to the next page unless you have done what you are expected to do in the previous page. Before you start each lesson, read first the INSTRUCTIONS. 24.Work on the activities. Take note of the skills that each activity is helping you to develop. 25,Take the Assessment-Test after you are done with all the lessons and activities in the module. 7aatiity 1 Assume that you are going to treat your friends to a restaurant to eat eat. WI can you write down your preferences and Considerations before choosing the best €: place !0 eat? 2. Why do you choose such preferences and considerations? Ss tis Business or firm? wha’ pis an economic endeavor that provides goods and servic i eS aiming for profit. Profi means a reward for a business owner who takes the risk in one and services. rendering products, goods Environmental Forces and Environmental Scanning Knowledge regarding organizational management |s essential in operating a fi business enterprise This is more significant if the person who engages in iia businoas has a basic knowledge in environmental scanning to seek for relevant Ramee beneficial to the business operation. Environmental scanning and knowing environmental forces of business is necessary for growth and sustainability of a ousiness enterprise. Business enterprise environment forces are factors and principal elements that affect the performance of the business firm. It is divided into two parts: intemal business environment and external business environment. The intemal business environment includes factors within the organization which may affect the performance of an organization either positively or negatively while the external business environment includes factors outside the organization that are relevant and may affect the performance of the organization. For Blended Learning: oo BREN A REMER race4. Direct Action Elements. (Miersenvironment) it fs known as the “Operating Environment.” It refers to the stakeholders of an organization, such as the consumers, competitors, suppliers, financial institutions, and govemment agencies, 2. Indirect Action Elements. (Macroenvironment). These are the socio-economic condition, socio-cultural situation, political-legal situation, technological situations and international-world ecological situations. The Direct-Action Components of the External Environment The success of a business organization depends on the influence of the elements on the direct-action components of the external environment such as: 1. Customers. It is the subject of the business including their loyaty and patronage which is very vital on the sustainability of the business firm. ‘Therefore, good customer service may apply and because first impression and a good experience last, these customers may also bring another ‘customer to your business firm. A customer might be individual, institutional like other organization, club, business firm and government agency. ‘Suppliers. Business firm should establish and maintain good relationship with the supplier because it is the one who provides materials needed in the Production. in business, there is always a competition. Therefore, itis good to establish goodwill so that the business firm will take advantage of the competition among suppliers to obtain better quality and lower price of Products and services, fast and on time deliveries and good after sales service. . Labor supply. The line “a square peg in a square hale” means the right person in a right position. Business should consider the ability, skills, attitude and experience of individuals during the recruitment period to avoid tum- over of workers. Business owners should also give necessary benefits and good compensation. 4. Competitors- it means rivalry of business industry. Business owners should consider looking upon the industry competition because it may affect the Profitability and performance of the business. When the competition is high, business owners must find a way to innovate and intensify its marketing and Promotion. 5. Financial Institutions. These financial institutions are intermediary to business sectors. Their purpose is to provide financial services because business usually needs funds for additional capital and further expansion. 6. Govemment Agencies. Change is the only constant in this world. The changes in government policies may affect the business organization. For example, the TRAIN Law in the Philippines will affect the business industry because of the increase in taxation on the sugar related products, cars, liquors and cigarettes. N 2 The Indirect-Action Components of the External Environment4, Economic Condition- The business condition in the decision-making, ‘Th am Shoat consider the economic firm. There is always a fluctuati rend of economic condition is not lation even the inf ie products, employment, and the income levels of mane, ae ope. ij 2, Socio-Cultural Situation - Business 9; and traditions of the people in nea eee look into the custom io sell fruits during Christmas season because fie mene temee saleable or engage in business during Fiesta, Lenten Suan 2 ie ae of Farm Products “Taboan" and even during pay day, Ruepuawonce 3. Political-Legal- Business firm may be effected by the implemented by the govemment. For example: ae eee are afiacted by some promulgated laws. a eaey 4. Technological Condition- Technology is life for a business ‘firm; without it, business would be left behind, Technology is an instrument used for advancement, innovation and development to increase production and Minimize cost. Imagine, how could the business moves on if there are no computers, no intemet connection, MIS and other programs and ischnological infrastructure? §, Intemational Relation- It is good for a business finn to be updated about information regarding the global economy bscause focal businesses aro affected by the global or intematlonal economie affairs, particularly the import and export industries lke what happened when China refuses to buy our export banana. The banana industry In the Philippines is losing as an effect of the refusal of China. Components of the Internal Business Environment ‘The internal business environment of the organization are the resources such a3 manpower, money, machines, materials, methods and reseerch and devefopment used inthe production of goods and services. This internal business environment shall be subjected fo intemal analysis so ihat that the business firm will see its internal strength, weaknesses, opportunities and threats (SWOT) before the organizational planning. oulube, e https:/Avww. youtube. comiwatch?v=Rin_ _gWJIoQ Components of Environmental Scanning: Developing a Competitive Ml a Business Forecasting, PESTLE ancl SWOT analysis, and Bonchmal — "4siness firms to seek for nee pl environmental . environmental information relevant to the organization, ee ora ee i Entrepreneurs nowadays have a positive mindset ig eats enterprise successiul, They look st every challenge as an opportunity, They ae see an opportunity in adversity by doing environmental scanning through Political, Economic, Social, Technological, Legal and Environmental (PESTLE) Analysis and the Strength, Weaknesses, Opportunities, and Threats (SWOT) analysis, swWoT analysis is a management tool used for analyzing business opportunities, Developing a competitive mindset is essential to every entrepreneur towin the war of competition. ‘AS Sun Tzu Said in his book the Art of War, Knowing the terrain where your enemy are, and knowing yoursel! is the greatest strategy in winning the war. This principle is exactly applicable to business environmental scanning that is the actual monitoring and evaluation In knowing the data and environmental Information which the business owner may be able io understand and forecast the various opportunities and threats that might affeci the life of business organization in the near future. Itis a quest for bu! Modes of Environmental Scanning 4, Ad hoc environmental scanning - The word “Ad hoc" is derived from the Latin word which means “For this" and it signifies the things created or done for a particular purpose as necessary. Thus, this mode of environmental scanning is done and only applicable during crisis situalion to determine whether the problem is either extemal or intemal. . Regular scanning — tt is dons usually once a year or at the regular intervals. . Continuous scanning — tt is the continuous monitoring and collection of data related to the factors affecting the business organization environment. en For Biended Learning: You may click the link below to enhance your learning process in this lesson: hitps:dwew. youtube. com/watch?v=Dip2axSqpdikc Business Forecasting tls also known as "business prediction’. It is a method of projecting, estimating, and anticipating the future evenis related to business environment based on calculated relevani information. It could be used as a basis in decision-making process of a business organization Business Benchmarking It is the process of observing, measuring, evaluating and emulating best Practices of the recognized business industry In terms of the products, goods and Services in order for the observers to identify iheir areas of improvements. The Local and International Business Environment of the Firm Business Environment of the firm will evolve and vary according to socio- cultural situations, economic conditions and standards of a certain location. It means 8t every country has fls own culture, norms and ‘ peresore. itis very important that all meneoee are ae it comes to business. develop their “Cultural Intelligence” that will enable them we 10 understand and opt the different cultures that affect the management practices sane SoMtY 19 aryanizaion both local and infernational. Local business eet ness iri peen infuenced by the international and giobal environmentinteme oe eo fetjiion and standards. Today's local entrepreneurs have da ers of semomic chatienge to become globally competitive ar red t0 accept the nd ready to a environment. Entrepreneurs today are updated and inna age 2 ee concept of global standard in a local setting where quality of products sh Less the Ss are vided regardiess of cultural differences. For example, - ee Korean Restaurants and) Japanese Rea peu you can customers? mostly Filipinos. It is an indication that mest entrepreneurs of cs ae culturally intelligent because they can easily understand the cultural fae Sie srecis their behavior and the business organization. poe thet WHAT’S MORE Definition of Terms Environmental Scanning ~ ft is 3 process of seeking and classifying environmental data and information use for business organization. External Business Environment - Is a factor outside the business organization which may affect the performance of the business either positively or negatively Gross Domestie Product (GDP} — It is a total output of goods and services produced within or inside the country. Gross National Product - It is a total output of goods and services produced oy within or domestic and from outside the country. Internal Business Environment - |t is a factor within or inside the business organization which may affect the performance of the business either positively or Negatively. Inflation - It is a period when the general price increases and the value of mor ae ‘ Ue loney decreases as indicated in the consumer price index.This fourth learning module of Organization genoa! siudents Is designed to provide teamers with a rms of business orgenization and pheses of economia ee sag of fo In this module, the students are able to exp! , and Management for Senior High lain the role of bush to the economy, the phases of economic development and areca Ge relation forms of business organization which enable the leamers to Put into ¥ i ae things which are mentioned here. Practice all the After studying this module, you will be able to: 1. Explain the role of business towards the economy; 2, Identify the different phases of economls development; and 3, Differentiate the various forms of business organizations. THINGS TO REMEMBER TO GET THROUGH To learn and benefit from this module, follow the following steps: 29.Read the module title and the module introduction to get an idea of what the module covers. Specifically, read the first two sections of this module carefully. The first section tells you what this module is all about while the second section tells you of what you are expected fo leam. 30.Never move on to the next page unless you have done what you are expected to do in the previous page. Before you start each fesson, read first the INSTRUCTIONS, 31. Work on the activities, Take note of the skills that each activity is helping you to develop. fi 32.Take the Assessment-Test after you are done with all the lessons ant activities in the module 33,Meet with your teacher. Ask him/her about any difficulty or confusion you have encountered In this module. 34, Finally, prepare and gather all your outputs and submit them to your teacher, 93,to see and understand the story from this link below: httos:/Avww. youtube com/watch?v=NPJ2ssL2rve_ what is Business Organization? Wr A business organization is a group of two or more Persons working together to attain a common aspiration and set of goals. Business organizations May have different forms according to their nature of operations, resources, Purpose and economic demand. This organization plays in accordance to the economic trends to ensure productivity and profitability. The Economic Role of Business Organization Business enterprise is an economic activity of man to find resources @nd utilize i in order to Survive. We Say “business is life” because business is the life of the economy and this economy becomes the life-blood of the government and the people. Business organizations can generate more Jobs to answer to the economic problem of poverly and unemployment of the country. It is definitely true that more jobs will resutt to more income for the people and government. Hence, it will help improve the value of the buying power of the people in the community. The economic role of business organization is interdependent to each other. It is the dynamic process of business organizations in the economy where everybody is involved. It is a matter of give and take Principle where the business organization provides jobs and income to the people, resulting to the increase in the income tax collection of the government, This tax is then used for the government's infrastructures and social services. Forms of Business Organization There are four basic forms of business organization, namely: 1. Sole or Single Proprietorship; oF9e 2. 3. 4 Partnership: Corporation; and Cooperative jetorshipis a form of business organization that is owneg rson, Itis the simplest form of business ownership, For Wholesale and Retail, Bakery and other service. Sole or Single Propri and controlled by one pe! example: Sari-Sari Store, provider industries. Advantages of Sole or Single Proprietorship Least cost of formation and dissolution, It is easy to start because it requires only a small capital and there are less legal papers needed except the permit from the Department of Trade and Industry (DTI) and a business permit from the Local Government Units (LGU's). 2. Holding of all Profits. it means that all profits gained from the business exclusively belongs to the owner of the business, This is the greatest reward of a single proprietorship form of business. 3. Independence and Flexibility. It refers to the owner as the manager and the boss of the business. He can do what he wants to do because he owns his time to work and implement his own decisions. 4. Tax Benefits and Advantages. Single proprietorship pays only a minimal tax according to his income, meaning his earning is taxed as personal income tax. The owner will only pay the government for the business licenses, pemits, and Taxes. 1 Disadvantages of Sole or Single Proprietorship 1. Unlimited Liability. It means that if the business fails, the owner will shoulder all his financial obligations. The worst is that the creditor may seize all the assets and sell it as payment for the obligations. 2. Lack of Stability. The sustainability of this business will only rely on the life and financial capacity of the owner. If the owner diés, then it is the end of the business unless close members of the family will assume to continue the business. 3. Limited Capital. Single proprietorship has limited capital since the assets of the owner is usually small. Financial Institutions are not willing to lend large amount of money for single proprietorship. 4. Limited skills and knowledge in terms of business management. !t means that in single proprietorship, the owner performs multiple tasks - a manager, bookkeeper, janitor, salesman. etc. . Partnership - It is a form of business organization which is composed of two or more persons who contribute money, property, skills and services to their organization and they themselves will act as co-owners of a business.100 4. Specialized Management, A corporation can hire consultants, specialists fo enhance the capability of its manpower and the improveme:’ of business operations. ent ‘The Disadvantages of Corporation 4. Difficutt to organize. Organizing a corporation requires a professionay Such as lawyer or accountant, to prepare the legalforms and financial documents 2. Strictly regulated and supervised by the government. Corporation has stringent requirements which the government imposed, Therefore, have to comply to all the government laws, policies, and Fegulations particularly on financial reporting. if Cooperative It is defined as a duly registered autonomous association of persons with common bond of interest, who have voluntarily joined together to achieve a lawiul common social or economic end by making equitable contributions to the Capital required and accepting a fair share of the risks and benefits of the undertaking in accordance with universally accepted cooperative principles. Principles of Cooperativism . Open and Voluntary Membership Democratic control . Limited interest on capital . Division of net surplus . Cooperative education |. Cooperation with other cooperatives PaALepo Open and Voluntary membership. It means that each member of a cooperative becomes a member voluntarily and is not restricted by social, political and religious discrimination, . Democratic Control. Cooperatives are democratic organization with officers and managers elected or appointed in a manner agreed on by members. Each member, no matter the amount of his share, is entitled only to one vote. }. Limited interest on capital. In cooperative, interest on a member's share capital is limited so that no person, specially those with money, can have an overwhelming equity in cooperative to prevent the domination of cooperative's affair. Division of net surplus ~ It is the sharing and allocation of cooperative surplus of savings. It mandates distribution of surplus equitably so that no member will gain at the expense of another. . Cooperative education — This principle makes provision for education and training of cooperative members, officers, and employees, and of the general public in the principles and techniques of cooperation.Cooperation with other cooperatives- it refer 1S strengthening cooperative movements to serviny th Srving mem structures. ough local, national and ee 6. Kinds oF Cooperatives "Credit cooperative ~ Promotes thrift among its me: to grant loans for productive and provident itil and creates funds in order Consumer cooperative ~ tts primary purpose iS talon commodities to members and fonrmembars of the coop. Te nae and distribute 4. Producers cooperative ~ undertakes joint - industrial Joint production whether agrciltrel or Marketing cooperative ~ It provides the supply of production inputs to members and market thelr products, Service cooperative — tt refers to medical and dental care, hospitalization, transportation, Insurance, housing, labor, electric tight and power, communication and other services. Multi-purpose cooperative — It combines wo of more of the business. activites in a different kind of cooperatives. oo aoe a For Blended Leamin: You may click the link below to enhance your lear wtb is Phases of Economic Development What is Economic Development? he economic, political and social infrastructure, access [0 housing dard of the fife of the people. It is a process in which a nation improves # well-being of its people. tt includes literacy rates, and healthcare. Thus, it improves the quatity stant For Blended Leaming: ess in this jesson: ‘You ray elie the link below to enhance your lea sg Fe hits /AvWW, youtube, comfwatchve3!VnDRYNEMA at is Economic Growth? itis simply a measurement of the change in the country’s naliol Gross Domestic Product (GDP). However, t{ does not deal much with the actual welfare of the people In the country nal output, OF (0lia i Competency: k._ Discuss the nature and levels of planning and types of plans. ABM_AOMA1.Je. g10-14-12 WHAT I NEED TO KNOW ‘At the end of this lesson, the learners are expected fo: 1, discuss the nature and levels of planning, 2. identify the types of plans, and 3, formulate effective plans for a specific business endeavor. WHAT 1 KNOW : Instructions: Recall what you leamed about planning. Read and answer the following statements. Write the letter of your answer in a yellow paper. 36. Which of the following is the primary function of management? a. planning b, managing c. organizing d. controlling 37. What type of plan is created when changes occur due to unexpected events in order to achieve the company's goal? a. tactical plan ¢, contingency plan b. operational plan d. disaster plan 38.This includes the formulation of on-going plans that explains the specific operation of the organization. a. strategic plan ¢. tactical plan b. operational plan g. contingency plan 39. It represents the company’s “dream” on what will it become in the future. a. vision b. mission ¢. goals d. plans 40. The following are responsible for strategic planning, EXCEPT: a. CEOs b, President ©, Staff d. Senior Executives 41.To be able to sell 100 pieces face masks daily, is an example of? 6ae Definition of Terms Planning - i @ process wherein the organizalion sels Ks goal, creales stnlegies [o attain the goal at the same time developes action plans or ways to achieve tle desired goal the organization is into Vision - represents the company's “dream” on what will tb cor jecome in the fuure Mission - identifies the purpose on wny the organization existed. This indudes the company’s product and services, its target market and how the company wanted to address the customer's needs and satisfaction. Goals - are specific targets or desired ends that the management wi ‘i amed usually attained over a long period of time aie ee Objectives - refer to the actionisteps needed in order to achieve the desired goal Never have a plary it'll just get in your way. - Matti Kubin Do you agree with this quote? Do you think things will ust get in your wey? What if it will not? ‘What will happen then? Are you willing to take the risk of not getting the things you want beciuse you fail to plan? How im) is planning? NsPlanning 6 like having a map and a compass with you. Even if you are in the middle of nowhee, if you have your map and your compass, you can reach your destination without wisting much time in roaming around. For instance, in the direction you are in, you ma encounter problems, but you'can Still find another way out. Planning 6 definitely important because establishing plans based on the set goals will provide diection to the organization's undertakings and will decrease the percentage of indecisons. Planning § an extremely complex process since it requires a systematic method of recognizirg and analyzing the elements of the organization's external environment and matcting with the firm's internal environment's factors and capabilities. In an envionment full of uncertainty, you need to understand that you can formulate assumptims based on forecasts of what is expected in the future and decide what to do, how tado it, when to de it and many more.Nature of Planning Cesena eet React a adhens RUC COU E te aarp RUCUCoCIaE EEC St eae RUMI CM onc en eet PU ec ic irr atens USCA ca bce Rec eCA eee Ceo RC eR es eur es uta ecu cue a ere sce makingy bei Gluten res Management, geese Leute emcees Mecha) o Be ree a CISL ea ec Be irae metic ics Pa eine nies Peas cee i) Bidar ss Mu dese peer Seman Peeper ilu ae ie Ces Coie acca nouns irae Cela Cars Ric emai ces cur How does Goals and Plans Differ? GOALS » i | the actions or ways These are the targets desired at | These are the end of the alfotted timeline in | that ae Se li mt wanted to will be using to which the manageme! | Pee peal reach y) eyes —— anJai1,000 pieces of sardines for the month of The goal of Fishda” store (S to ‘August 2020. | they plan to divide the sales target oe ee which will i ioe > ces . ‘ yal pact 250 pieces per week of 36 pieces p require them i iit not only rely on the iditionatty, they will no plan el and advertise their product G Face | since online seling is effective nowadays. | Lastly, they will offer free delivery for a minimum purchase Of 10 pieces. r | | 1 walk-in buyers in their store. They aiso book and other social media platforms. Whenever a company sets its goal, the eee will then strategize and make action plans that are best suited to achieve the goal. ifthe management fails to come-up with an effective plan especially when other factors arise, tendency is, the goal will not be achieved. Thus, effective planning is very important and crafting strategies is crucial for this requires efficient and effective decision-making. Are youl a member of any organization In your community? if yes, whataro. the plans of your organization as a - 2 A whole? te Organizational plans can be generally described in terms of Comprehensiveness, Jenath of time covered or timeframe, specificity and frequency of use, Comprehensiveness refers to the completeness of planning coverage. al Specificity refers to very detailed, clearly defined plan wherein objectives are Cleatly stated and could easily be understood. Simple language must be used in order to facilitate understanding of the plan, Frequency ~ refers to the number of times or instances a example, Strategical plans have Single use, Slanding or are used-frequently or several times, plan may be used, For while operational plans are usually lie 12‘VPES OF PLANS spians that establish the organtaatlon’ rganization's ove ‘bee Soh mission, ‘and values as a cates ci “Are usually broad in scope andre the eons u da president and general manager othe compen Of the organkation's CEO, all goals and apply to the enti . eee «plans that are applied to particular unt aree cao on uf “Ale Includes tho formuialon of on-gomn pans Vek hee the organization ‘explains the specific operation of +a company's goal may not be achieved If -ongehng pars ean Ba nan afthece forme: Pe eons Pe me ne at +Policy - 9 set of principles that guide managers in addressing 2 particular issue +Rule - 3 reguistion which describes and regulates the function: : S 8 of an zat Proceaire: Saco ey process in accomplishing a task or achiedg an “is the support of strategie plan bec Sees pan esto ecause it includes approaches that will be used in «translate broader plans into functional goals for each area or department tactical planning is short-term and is focused. vie oreated when changes oocur due to unexpected events n orier to achieve the company’s goal As the popular phrase goes" Justin case Pian A will fal youstil have Plan B, andso on As you can see in the illustration above, there Is a hierarchy of plans that sterts from the top which Is the organization as awhole (strategic plan), then anotlver plan which will be executed by the specific uni/department (operational plan) who will be working on ihe plans to achieve the organization's goal. If the plan fails due to unexpected changes, there should be another option (contingency plan). Steps in Planning (Schermerhom, 2008) 4. Define your goals/objectives by identifying desired ouicomes /resulis in very specific ways. i 2. Determine where you stand in relation to set goals/objectives; know your strengths and weaknesses. 3, Develop premises regarding future conditions; anticipate future events, generate alternative "scenaries” for what may happen; identify for each scenario things that may help or hinder progress toward your goals/objectives. 4, Analyze and choose among action altematives; list and carefully evaluate possible actions and choose the altemative most likely to accomplish goals/objectives. 135, {mplement the pian and evaluate results; take corrective action and revise plans needed. Different Levels of Planning Management Level Characteristics Responsibilities __] Top-level Management Planning (strategic planning) ¥ CEO presidents vice-president board of directors senior executives. Widdle-tevel Management | Planning (Tactical Planning) Y general managers y¥ branch managers ¥ department managers: \w is the The _top-management teams are mostly experts in the fieldindustry they are In. These people are experienced in tho business for a long period oftime. They can communicate well, charismatic and most importantly, have a sense of responsibility and accountabillly in. carrying out their task. in-between leadership level of @ ranked organization, being subordinate to the senior management but above the lowest levels of operational staff. it Is accouniable to the top-level management for their branch/department's functions. Since the middle managers work with both top-level managers and first-level managers, they fend to have excellent interpersonal Skills relating to communication, Responsible in decision- making and overseeing the company’s tong term plan goals at the same time crafting strategies on how to aitain the goal. They formulate the plan, however, they do not execute the plan on their own, instead, «=a management team supports and helps them in carrying out the task. Implemenis the organizational plan in accordance with the company's policies and objectives of the top Management Defines and discusses the information and_ policies from the top management down to the lower management Assists, motivates and guides the fower-tevel Managers for them to Perform —betier and accomplish the business objective 14— Gasign Jobs and tasks ¥ section officers ¥ superintendent motivation, and mentoring. Fantinenower-evel | is also known a8 Management Planning | supervisory 7 operative (operational Planning) | level of management. y supervisors Those whose work has to ¥ foreman be largely with personal ‘oversight and direction of ‘operative employees Concerned with direction and controlling function of management various workers: guide and instruct workers of — their day-to-day activities supervise the quality as well as quantity of production maintain good relation in the organization image-builders of the enterprise because they are in direct contact with the workers: prepare periodical reports about the performance of WHAT’S MORE | the workers Activity 2, Determine what level of manat i i gement planning does the follow’ Shade the box that corresponds with the correct ee money: Top-level Middie-level | Lower level Menederer Management | Management lannin i Mr, Anton Dela Cerna, the : ani aaa marketing head of Alaska company | Miss Santos who reports to Mr. Ramoso, the president iz a‘An IT expert who runs his own company Top-level Middle-level | Lower leva; Management | Management | Management Planning _| Planning _ Ms, Torres who discusses the company's policies to the newly hired employee Planning _| | | Madame Gomez who can communicate well, charismatic and has a sense of responsibility and accountability in carrying out her task (Miss Vacalares, the one who supervises the production unit Mr. Palacios, a member of the board of directors Enk, the in-charge of quality and quantity control of ABC: mpany, . Khu who leads the operational | planning of his unit_ ‘Danica Lopez, the one who assists, loves to inspire and motivate her teammates to do their job a 'T ! HAVE LEARNED , Ifgiven a chance to open your own business, what would it be? After choosing, list down your goal/s and plans for your business .Use the given format below: Name of business: Nature of Business: Timeframe Goals Plans (actions or means to use in achieving the goal) 16SENIOR HIGH SCHOOL \ Organization and Management Quarter 2 - Module 9 Staffing: The Nature, Recruitment and Selection Process Department of Education e Republic of the Philippines f/.Dy ee Eee Competencies: an a. Discuss the nature of staffing Tee ot arsiada AGM RT : the recruit b. Explain the steps in Ma-b-21 At the end of this lesson, ihe learners are expected to: 1. discuss the concept and nature of staffing; and 2 analyze the recruitment and selection process. True or False: Answer T if the statement is true and F ifthe statement is false. Applicants best-fitted for the job openings. - Relying too much On interview is the bes t way in the selection Process. 5. An employment test can be valid but not reliable. 8. Selection Procedures for managers do not differ from NOn-manageriat employee selection, 7. Unstructured interviews are eliable and often Yield effective ang useful information, 22. Identty the different sources used by Mr Gonzales in the above cage stud hud, 3, Explain the merits of above source 9.4 THE NATURE OF STAFFING Staffing oi Human Resource Management - involves acquiring and developing human resource: perform the various activities in the organization - the filling up of all organizational job positions and keeping these positions flled with the persons who are most quaiified to do the job Jat will carry oul and Human Resource Department - tasked with implementing human resource management in the company - the primary activities include human resource planning. job analysis, recruitment and hiring, training, performance appraisal compensation and employee relations - jesponsible for ensuring the company's workplace safety standards and employment laws - staffed by human resource professionals and headed by a Human Resource Director‘The Staffing Process Recruitment/Selection/ Placement: Performance Appraisal - Human Resource New employee orientation Career Management ree “raining and Development Compensatbn Figure 1. The Stafing Process Staffing piocess stresses on equipping the organization with an exa:t number of people at the right time and place to heip the organization attain its objectives effectively. The staffing process involves a series of steps, discussed as folow: 1. Manpower Planning: Popularly known as human resource planning, it is the process of forecasting the firm's demand for and supply of competeniworkforce in an adequate number in the future 2. Recruitment: It entails seeking, stimulating and obtai as possible from eligible and competent candidates. 3. Selection: Ii is the decisive step of the staffing process. whic: involves differentiating between applicants, so as to identify and choose thecandidate who best fulfils the qualifications and requirements of the vacant pation 4 Placement: It is the allocation of rank and responsibility to selectedcandidate 5. Orientation and Induction: After the placement, the next step is to yravide the new employee with the information they require for functioning comfmably and efficiently in an organization Induction is the process of introducing the new joinees to the job and the organization as well 6. Training and Development: in this step, the new joinees undergotraining te acquire specific skills. Development implies learning opportunities, designed by the organization, to ensure the growth of employees. 7. Performance Appraisal: I! is a rational assessment and evduation of employee's performance against clear-cut benchmarks 8, Career Management: i is a process in which the individual understands and leans new skills and interests and use them for the betterment of the organization and self. 9. Compensation: It refers to the consideration which an individual gaits in return for his/her contribution to the organization 1 as many applications9.2 RECRUITMENT RECRUITMENT PROPER ALOCATION PROCESS of ATERACTING KNOWS THROATS op sad EQUIPPED with QUALIFIED APPLICANTS ‘THE ORGANIZATION Projer allocation entails placing the employees in the right departments makng sure they are equipped with the right skills and experience tor the me Theprocess of attracting qualified applicants !o occupy vacant positions a th conpany. To ensure the success of recruitment, the management must Ray the joals of the organization and the reasons for hiring people. There are wo typs/saurces of applicants Internal applicants — are company employees who considered for promotion to higher positions. itis ideal because company incurs lesser cost since the internal applicant is already familiar with the job helshe will be occupying. « Externaf applicants — ate individuals who are recruited by the company or directly applied to join the company. Several options when recruiting external applicants are + Advertisement and notices in print media like magazines and newspaper + Job fairs and trade events + Referrals (where their ovm empioye: = Walk-in applicants «Manpower agency = Internet Equal employment opportunity — ensures that an applicant is not discriminated against berause of his/her age. color, race, religion, civil status or gender recommend suitable spplicanis) 9.3 SELECTION Slats when the applicants, who qualify after preliminary screening. ate schiduled for the preliminary interview and psychological testing conducted by the Human Resource Department (HRD). Thefollowing are the steps to follow in the selection pracess: Establishing the seiection criteria !. Requesting applicants to complete the application form }. Screenino by listing applicants who seem to meet the sel criteria |. Screening interview to identify more promising applicants 5. Interview by the superviser/manager or panel interviewers 5. Veritying information provided by the applicant7. Requesting the applicant to undergo psychological and physical examination 8. Informing the applicant that he or she has been chosen for the position applied for ‘Types of Job Interviews re es Structured interview - the interviewer asks the applicant to answer a set of prepared questions Unstructured interview — the interviewer has no interview guide and may ask question freely One-on-one interview — one interviewer is assigned to interview the applicant Panel interview — three to five interviewers take turn In asking questions Types of Employment Tests Intelligence test — designed to measure the applicant's mental capacity, cognitive capacity, speed of thinking and ability to see relationships in problematic situations Proficiency and aptitude tests — esis the applicant's present skills and potential for learning new skills Personality tests — designed to reveal the applicant's personal characteristics and ability to relate with others Vocational tests — tests that show the occupation best suited to an applicant 9.4 PLACEMENT it is the last part of the hiring process where an applicant is hired as an employee and is oriented and situated into his/her pasition. When a candidate is hired in a job, the next step is the submission of requirements like transcript ofrecords, NBI clearance, certificates, and other documents. The candidate will also undergo medical examination to determine his or her fitness for work. The status of employment may be probationary, contractual, or project-based. © Contractual employees and project-based employees are given & contract to work far the company for a limited period of time. © Probationary employee is given 2 period of six months afer which he or she is evaluated before becoming a regular empioyee.‘SENIOR HIGH SCHOOL . Organization and Management Quarter 2 - Module 10 Training and Development Compensation/Wages and Performance Appraisal Department of Education » Republic of the Philippines Wyee Competencies: a. Recognize the different training programs. ABM_AOM 11 -4la-b-22 b. identify the policy guidelines on compensation‘wages and performance evaluation/appraisa!. ABM_AOM41- Ila-b-23 WHAT I NEED TO KNOW At the end of this lesson, the leamers are expected to: 4. analyze the process of training employees, . fecognize the policy procedures on compensation or wages and performance evaluation or appraisal; and exarnine the functions and importance of compensation and wages | (4) ie 7 Instruction: Fill in the blanks by choosing the appropriate word or group of words in the box. Write your answer in your activity notebook. N o y Executive payment: Lecture Wage Service chargé Training Case study Retirement pay Pre-training assessment COLA Group incentives Holiday pay Results Basic pay Merit pay Flat rates Overtime pay Night differential payment 13" mont?e 40.Unhealthy personality of the evaluator 40.4 TRAINING AND DEVELOPMENT Training and development refer to two separate processes for an employee's growth, The campany helps the employees improve their skills through training. Basically. training refers to an organized activity that increases and enhances employees’ knowledge and skills on their job to improve their current performance. On the other hand, development is the enhancement of the competencies of employees by giving them opportunities for greater responsibilities as well as challenging tasks that will help them achieve their total growth The Training Process This ensures that the implementation of training programs will benefit the employees. This process includes pre-training assessment, designing the training program, implementation, and evaluation Pre-training assessment — Allows the trainer to identify which aspects of the trainees need improvement _ The objectives of the training program are formulated and should be SMART (Specific, Measurable, Achievable. Realistic, and Time- bounded, Designing the Training Program _ [t identifies the training methods to be used, the time frame for implementation, dates and venues, evaluation methods. resource persons or speakers, and training cost. The foliowing are the training techniques, depending on the training objectives, background, and skills of the trainees: 1. Lecture 5. Virual reality 2 Demonstration 6. Case study 3. Computer-based 7. Role playing training 8. Teambuilding 4. Programmed instruction Training implementationThe various types of \saining program implementation includ= on-the.jop taining, apprenticeship training, classroom instruction, audio-visya; method, simulation method, and e-learning Training Evaluation To measure the effectiveness and success of Iraining and development programs, the following criteria for evaluation can be used 4. Reactions- include the actual reactions of the tramees to ditferent aspects of the program from conten! to venue, food, accommodation and visual aids 2. Results: include the end result and benefits of the program as seen in Job performance. productivity, and efficiency 3. Recail- includes what has been leamed, remembered and the actual application of the participants 4 Retrieval. refers to how easily information is recalled from mernory and unmediately applied by the participants - Ills a continuous process as the company seeks to continually implement vetier traming ana developmemi programs for their employees 10.2 COMPENSATION AND WAGES Compensation is any tangible equivalent or reward for services rendered of for the gerformance of a task performed in the organization. Salary refers to compensation given to professionals on a monthly or semi-monthly basis On the other hand. wage refers to compensation given on a weekly oF daily basis and usually applies to manual workers such as carpenters, plumbers, electricians, and the like. Furthermore, base pay or basic pay is the fixed part of pay It is the minimum payment for the tasks rendered by the employee based on his or her position of job title Common Modes of Payment - The following are the common modes of payment given to employees: 1. Payment for time worked « Monthly-paid employees are those who are paid each day of a paiticular month including unwotked rest days. special days, and regular holidays. « Daily paid employees are paid on the basis of the days they actually worked and unworked holidays. ~ Payment for time worked in adjustmen! Y Across-the-board-increase ~ pay adjustment with the same rate regardless of rank ¥ Merit increase ~ salary or wage increase on the basis of performance ¥ Cost-of-Living Allowance (COLA) — 2 monetary allowance given to employees to help them cope with the prevailing conditions of thea 2 a) economy related to the standard of living and increasing prices of commodities due to inflation ¥ Seniority Pay — given based on the number of years of service in the company . Flat rates: » Do not consider skills and seniority as factors for giving compensation » Gompanies pay their employees the same amount regardless of rank. Compensation through incentives » Payment made based on an output + Most popular form of incentives pay are the following: ‘a, Merit Pay —given in recognition of an outstanding performance b. Piece Rate Pay — given ta employees who are paid for fixed rate per product produced c. Commissions — a compensation based on an achieved sales quota d. Group Incentives — given to a team that has achieved a particular sales or production target Payment based on skills This is based on the number of skills the employee has gained while working for the company. Payment based on knowledge or credentials This is given to employees who attend seminars and conferences and gain knowledge which helps improve their performance in the company . Executive payment This is given to chiefexecutive officers, the chairman of the board, and other members of top management. Special payment ‘Additional compensation given on special cases are the following: a. Overtime pay — This covers work done beyond the normal schedule of eight hours a day. For work in excess of eight hours performed on ordinary working days, overtime pay is 25% of the hourly rate. For work excess of eight hours performed on a scheduled rest day, special day, and regular holiday, overtime pay is 30% of the hourly rate. . Holiday pay — payment for an unworked regular holiday based on the employee's daily rate c. Premium pay — payments to employees who worked during rest days and special days d. Night differential payment — This is an additional 10% of the employee's basic rate for each hour of work performed between 10:00 pm to 6:00 am. e. Service charge — It refers to fees charged to cover services related to producing a product or providing a service. sf, Severance or Separation Pay — It is the duty of the firm jo separation pay to employees who are terminated with auth An authonized cause may be one of the following: 1. Retrenchment to prevent further losses. ‘2. Closure of a firm 3. Iiness that may affect his performance oF is highly comagious a: Retirement pay — An employee who's 60 0°65 years old shal ipoeng ane half menth salary for every year of service provided thal he or she yo rendered five years of continuous service for the company, . h. Thirteenth Month Pay — All employees are entitled to a thitteenth month Pay provided thal they have worked for al least one month in a calendar, Prove orizey ‘Cause, 40.3 PERFORMANCE APPRAISAL. ~ Its also known as performance review or performance evaluation, ~ _Itrefers to the process in which an employee's performance is documented ang evaluated to ensure efficiency and adaptabilily io company's standards and expectations. ~The following are the purposes of performance appraisal: 1. Needs assessment ~ Performance evalualion provides relevant information about the specific training needs of employees 2. Employee movements ~ it nelps management decide who will be Promoted by providing proof of meritorious performance. 3. Basis for merit increase - Periormance appraisal gives strong proot for merit increases, 4. Legal concerns —Ifthere are questions regarding certain decisions, tke termination and issues on rewards, layoff, and employee transfer. the results of the appraisal are the basis. 5. Development — A series of performance appraisals tracks the growth of employees. 6. Channel of communication — Appraisal provides a good venue for discussion regarding performance and other issues between an employes and his or her immediate supervisor. T. Source of motivation — It is one way to boost the employee's morale and gives an outstanding performance for the job, Performance Appraisal Method Some appraisal methods used today are the following: > Trait methods — designed to find out if the employee possesses important work characteristics such as conscientiousness, creativity, emotional stability, and others > Graphic rating scales — each characteristic to be evaluated Is represented by a scale on which the evaluator indicates the degree to which an employee possesses that characteristicv Forced-choice method — requires the rater to choose from two stalements purposely designed to distinguish between positive and negalive performance Behaviorally anchored rating scale (BARS) — includes five fo ten vertical scales, one for each important strategy for doing the job and numbered according to its Importance > Behavior observation scale (BOS) — measures the frequency of observed behavior v Why Some Evaluation Programs Fail? Performance appraisais, such as manager/supervisor appraisal, self-appraisal, subordinate appraisal, customer appraisal, peer appraisal, team appraisal, or 360- degree appraisal, may sometimes fail due to various reasons including the following: * inadequate orientation of the evaluates regarding the objectives of the program; incomplete cooperation of the evaluates; + bias exhibited by evaluators; + inadequate time for answering the evaluation forms; + ambiguous language used in the evaluation questionnaire; * employee's job description is not praperly evaluated by the evaluation questionnaire used; » inflated ratings resulting from evaluator's avoidance of giving low scores; » evaluator’s appraisal is focused on the personality of the evaluate and not his of her performance: + unhealthy personality of evaluator; and » evaluator may be influenced by organizational politics. WHAT’S MORE Activity 2. Things To Ponder Mario, @ high schoo! kid looking for a summer job, was hired as a cook at a nearby restaurant. He has no experience working in kitchens, but the supervisor who hired him, explained that it wasn't necessary, because they would train him. On Mario's first day, he was paired with a Seniar Line Cook by the name of Fatima. Fatima wasn't especially thrilled with the idea of having to train a new guy on the busiest night of the week and expressed her cancers to the manager. “You're our mast senior employee so that makes you the most qualified person to do the training.” A frustrated Fatima didn't say much after that. Aside from giving Mario a nod of acknowledgement, her only words to him were “watch, and stay out of my way.” ioSee aricnineteay Organization and Management Quarter 2 - Module 13, Controlling i eatne pemnsr ct Department of Education e Republic of the PhilippinesCompetencies: a. Disouss the nature of controlling. ABM_AOM11-IIF-h34 b. Apply management control in accounting and marketing concepts and techniques. ABM_AOM11--)37 Al the end of this lesson, the leamers are expected to: . discuss the nature of controlling; 2. explain the control methods; and apply management contrcl In accounting and marketing concepts and techniques. » instruction: Read each item below. Choose the letter which corresponds to the correct answer and put it on your activity notebook. 4. Itrefers to the obligations of the company to its creditors for past transactions such as acquisition of raw materials. a. Liabilities bAssets ©. Equilies d. none of the above 2. Itcontribules to the achievement of organizational goals by correcting errors from established performance standards. a.Planning > —». Leading ©, Controlling d, Organizing 3. It is a method which prevents problems because & managerial action is taken before the occurrence of actual problems. a. employee discipline ¢. feedback control b, feedforward control d. concurrent control 4, The following are major parts of balance sheet EXCEPT ONE:5, In your own idea, what is control in the organization or i , in business? 44. THE NATURE OF CONTROLLING Controlling is a major management funct achievement of organizational goals by eoreelna eS aaa onal S from established performance standards. It is an ongoing mae that it = members at all levels of the arganization. The contro! function is the responsi ver everyone, 50 employees are expected to be concemed of the problems even if these are not their duty and responsibility The organization should determine the standards for crucial tasks and try to maintain it effectively ‘and efficiently. Whenever job and performance fall below standards, the organization should correct and address the problem immediately. However, when the organization exceeds its standards in a certain project, it is sensible to reward the people behind the success ‘of the business to highlight exemplary job performance. Importance of Management Controt Management control makes sure that the firm's operating cash flow is sufficient, efficient, and if possible, profitable when invested. The working capital, when properly controlled, can sustain the daily operations such as financing, salaries of employees, inventories, credit payme! nts to suppliers and more. Spending and full of uncontrolled expenses without thinking of how to regain it in the future could put any starting business OF even the established ones in jeopardy. The Control Process ting criteria by which performance dards — means Si .cged in terms of non-measurable 1, Establishment of stan will be measured. Standards can be expreselements such as customer loyalty, or they can be quantitative In terms of measurable standards such as output, money, or time. 2. Measure of performance — means identifying strategic control points. This includes indicators such as income, expenses, inventory, product quality, and the employee's number of working hours. Employee performance can be measured through actual observation, using devices and financial ratios. 3. Comparison of the actual performance with the standards ~ means conducting benchmarking by comparing thelr performance with exemplary practices from other companies in the industry 4, Taking corrective actions and realigning processes when necessary — When the company has determined that fts performance has deviated from the standard, corrective actions should be applied. Deviations from the standards may be a result of incorrect planning or misinterpretation of instructions. 44.2 CONTROL METHODS Contro! methods are techniques used for measuring an organization's financial stability, efficiency, effectiveness, production ouput, and organization members’ attitudes and morale. Control Techniques are elther quantitative or non-quantitative. Quantitative control methods include chart, budget, and audits. Non-quantitative control methods include inspections, direct supervision, on-the-spot checking, performance evaluation and counseling. Timeliness is important in implementing control methods and techniques. The manager "must be aware of it. 1. Feedforward control. This type of control anticipates the occurrence of possible problems so that preventive measures can be implemented before the actual operation. This is commonly practiced by airline companies. 2. Concurrent control. This type of control is implemented while the activity is in progress, For example, office operations are affected by employees engaging in personal activities like, surfing in Facebook or watching YouTube videos, resulting to lower productivity of the employees. The manager should immediately address this issue by monitoring the activities of the employees. 3, Feedback control, This type of control is done after the activity. Feedback enables managers to gather information and determine whether the activity is a success OF failure. Fiyece year aed on nes44.3 APPLICATION OF MANAGEMENT CONTROL IN ACCOUNTING AND MARKETING CONCEPTS AND TECNIQUES Management control in accounting and finance lt makes use of 2 balance sheet, income statements, and cash low Htatement fo analyse and examine financial statements in ortler 10 determine the company’s financial soundness and viability It alse uses financial ratios to determine the company’s stabilly, whether il is strong ot weak and about to declare bankruptcy Balance Sheet ~ provides 2 summary of the company’s financial position or Conuition over a period of time. The standard formula defining the financial status ofa company using a balance sheet s Assets = Liabilities + Owner's Equity The three major parts of a balance sheet are the following: 1. Assets - things or resources that the company owns a. Current Assets ~ include cash on hand, cash deposited in banks, prepaid of advance payments not yet used, accounts receivable, and nventory Property, plant, and equipment — include assets such as land, buildings. leasehold improvements, equipment, furniture and fodures, delivery trucks, machinery and other capital owned by the company. These are example ef non-current assets thal cannot be easily converted to cash c. Intangible Assets — refer to assets that do not have physical subctance and may be hard to evaluate and include patents, Copyright, goodwill, and the popularity of a trademark or company name q Other Assets ~ refer to assets thal cannot be classified unde: the main classification of assets 2. Liabilities - the obligations of the company to creditors fer past transactions such as acquisition of raw materials and other debts Two clessificetions of liabilities: 1) Current liabilities — usually due within one year 2) Long-term liabilities ~ have a prescribed peried of more than ¢ year The following are under current or long-term liabilities depending on the duration of obligation a. Notes payable ~ the amount of loans due based on a written agreement or promise to pay b. Accounts payable ~ refers to the obligations of the company tosuppliers without a written promissory note and is classified as current lability c SSS and PhilHealth payables — current liabilty that is speciic in the Philippines. These are the benefits that the employees will bereceiving monthly But the amount of contribution fram the compary and its employees has not been remilted to SSS and PhilHealth 4“d. Income taxes pa 'yable~ shows the amount th taxes to the goverment Se Senn ere e. Sai snes Payable — the amount due to the employees but are not yet Given as of the date in the balance sheet Interest payable — the amount of interest t Proceeds of a loan that is due as of the dale i ff he company owes from Nn the balance sheet 3. Owner's equity or stockhalder’s equity - Show the amount of owners of the business have invested, Owner's equity eee rf . 's applicable for sole Proprietorship while stockholder's equity is applicable for corporations Composition of stackholder’s equity. @ Common stock — Ths represents ownership of the corporation and enables stockholder to elect board of directors. The share in the profits of the firm is in the form of dividends. Preferred stock — does not share in the company's eamings but are only given a fixed dividend Retained earnings ~ This is the net income of the corporation less dividends = Income Statement — reports profits eared or losses incurred by the company over agiven period of time Three main parts of income statement: 1. Revenue/Sales Revenue/Other Revenue Revenue ~ the income from primary activities such as the eroduction and selling of goods on the part of the manufacturer Sales Revenue — refers to revenue gained from the sale of goods by retailers, distributors, manufactures, and wholesaiers Other Revenue — comes from secondary activities unrelated to the main business like rent from idle warehouse or garage . Expenses — cost incurred in the operation of the business such as salaries and wages of employees, utilities, sales commissions, and payments in advertising and promotions Net Income ~ The standard formula of net income is Net income = Revenues — Expenses. Profit indicates that expenses are less than the total revenue at a given period. Loss indicates that expenses are greater than the revenue Cash Flow Statement summarizes the inflow and outflow of cash during a given Period. Inflow activities are those that result in providing the firm with sources of funds, while outflows result in cash leaving the firm due to payments that use cash. Accounting/Financial Control Ratios Every business’ goal is to gain profit: hence, managers need accounting/financial ratios in order to achieve it.The following are the common financial ratios utilized in Monitoring company performance a Liquidity ratio ~ measures the company’s ability to meet its cuent debt obligations Current ratia = current assets + current liabilities b. Leverage ratio ~ assesses the arganization’s use of debt to fnance its assets and meet the interest payments on debis Debt:to-assets ratio = total debt = total assets ¢- Activity ratio —determings if the organization s carrying more investory than what it needs: the higher the ratio, the more efficiently inventory assets are being used Inventory turnaver = cost of goods sold + average Inventory 4G. Profaability ratio — determines the profits that are being generated Profitability ratio = net profit after taxes < total sales or it measures the efficiency of assets to generate profits Return on investment = net profit after taxes = total assets Marketing Controls Wt refers to the measurement of the company’s marketing performance in terns of the sales revenue generated, market share captured, md profit eamed. Sales are considered as the “lifeblood of the business* because even if the product is good, if it is not sellable to the market, there is n¢ way the business can survive. pis LiF, 1. Annual pian control As profit Conitrey, the name suggests. the plans for the operational attivities of Soe oe the business are cortrotied for ss Types of 5. a year through the successful “"S Marketing Control 84 implementation ty the management The following are the five vital tools used under the annual plan control mechanism: to2, Profitability control. It determines if lhe company ears profil for its activities and \dentifies where the company is making or losing money It is analyzed by product, segment, lerritory, customer, order size, and trade channel 3, Efficieacy control - This keeps track of the efficiency of marketing expenditures such as sales force, advertising, sales promotion, and distribution. For example, the sales force can be evaluated based on the number of sales calls per day number of orders or customer relationships and tesponses. 4, Strategic control - This refers to processes implemented to control the formulation and competion of strategic plans. There are two fools used to implement strategic control: 1) Marketing effectiveness. lt evaluates the extent and quality of customer relations and how well marketing activities and functions coordinated, It uses data-gathering instruments fike questionnaire to review the market's effectiveness. 2) Marketing audit. This is a detailed and systematic analysis of past and present marketing activities of the organization. it is done periodically and the managers conduct SWOT analysis and environmental scanning WHAT'S MORESENIOR HIGH SCHOOL Organization and Management Quarter 2 - Module 45 Functional Areas of Management Department of Education » Republic of the Philippines‘hig diteenth learning medule of Organization and Management for Senior High geno! students is designed to provide learners with a better understanding of ie ‘eas organization and phases of economic development dule, the students are nal areas ol! to practice all the arms of DUE able to explain the role of business in relation { management in business organization which things which are mentioned here In this mo economy. the functio ners to pul in this module, you will be able to to the enable the leat alter studying 1 Explain the role of business 1 nature and role in the firm of the following functional areas of 7 {a Human Resource Managemen! { >, Mareting Management 1 ¢ Operations Management 1.4. Finencial Management be Information and Communication Technology Management management m this module, fallow the following steps. To learn and benefil fro title and the module introduction to get an idea o! what the medule covers. Specifically tead the first two sections of this module carefully. The first section tells you what this module is all about while the second section ‘ells you of what you are expected to learn Read the module unless you have done whal you ate Never rove on to the next page Before you start each lesson, read first expected to do in the previous page the INSTRUCTIONS 3. Work on the activities. Take note of the skills that each activity 5 helping you to develop