Module 2

Subject: ABM 083: Introduction to Agribusiness Management

Chapter Title: Introduction of Management in Agribusiness

Lesson Title: Management Today

Lesson Objectives:

1. Define management
2. Identifying managerial functions.
3. Identify major components of contemporary management theory

Overview/Introduction:

This chapter begins with an overview of management. First, it describes the

manager’s job by defining management—noting the importance of both efficiency and
effectiveness—and identifying managerial functions Together we will explore the dynamic
nature of the management process in all its forms—how it started and how it has changed.

Activity:

1. If you will receive 1,000 pesos, describe how you are going to spend/allocate
this amount.

Analysis:

1. How do you define management in your own understanding based from the
decision you have made in spending the 1,000 pesos.

Abstraction:

Management can be defined as a set of activities directed at the efficient and effective use of
resources in the pursuit of one or more goals. Three distinct elements of this definition,
1. First, the manager’s job involves activity. Managers do not sit around all day thinking.
Instead, their days are filled with action, including talking, listening, reading, writing,
meeting, observing, and participating. Most managerial activities can be classified into
one of four categories: planning, organizing, leading, and controlling.
2. Second, management involves the efficient and effective use of resources.
3. Third, our definition of management notes the importance of organizational goals. Goals
are targets for which organizations aim. They can be developed for many different areas
and levels of an organization. The setting of appropriate goals is an important part of the
manager’s job.

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Efficiency and Effectiveness
At several points in the discussion so far, the notion of successful management has been
raised. Exactly what is successful management? It is the achievement of both efficiency and
effectiveness in reaching goals.

Efficiency means operating in such a way that resources are not wasted. Inefficiency can
relate to any category of resources. An efficient manager invests surplus funds promptly and
wisely, harvests crops at the right time, devises employee work schedules so that people
always have something to do, designs production systems so that little is wasted, and acts
upon relevant information in a timely manner. Successful managers are also effective.

Effectiveness means doing the right things in the right way at the right times. A manager
who enters a new market just before it starts expanding, gets out of a market before it
collapses, and maintains an appropriate competitive posture is more effective than one who
enters a market as it starts to decline, gets out of a market just before it starts growing, and
does not maintain an appropriate competitive posture.

Managerial Functions
1. Planning and decision making - involve determining the organization’s goals and
deciding how best to achieve them. Just as a carpenter looks at a blueprint to
determine which rooms to put in a new house and how they must be configured, a
manager looks at plans to determine what course has been charted for the
organization.
2. Organizing - the second basic managerial function is organizing—the process of
grouping activities and resources in a logical and appropriate fashion. In its broadest
sense, organizing is creating the organizational shape of a firm. The determination of
how much power to give each division head, the number of subordinates under each
division head, and the kinds of committees are necessary to the organizing process.
In like manner, when a supervisor groups the activities to be performed by team
members, she is organizing.
3. Leading - The third basic function inherent in the manager’s job is leading—the set of
processes associated with guiding and directing employees toward goal attainment.
Key parts of leading are motivating employees, managing group processes, and
dealing with conflict and change. Note that each of these activities relates to
behavioral concepts and processes. In most family businesses, leading becomes
extremely important and challenging as the businesses are passed down to younger
family members whose views for managing and growing the business may clash with
the founder’s.
4. Controlling - The final basic managerial function is controlling. Controlling is the
process of monitoring and adjusting organizational activities toward goal attainment.

Contemporary Management
1. Systems Theory - is an approach to understanding how organizations function and
operate. A system is an interrelated set of elements that function as a whole. It has
four basic parts. First, the system receives from the environment the four kinds of
inputs or resources that were included in the definition of management. Second, these
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 various resources are transformed into outputs through a variety of processes, which
represent the organization’s technology. The third part of the model, outputs,
includes products or services, behaviors, and profits or losses. Finally, feedback from
the environment provides the system with additional information about how well its
actions are being accepted.
2. Contingency Approach - A second important contemporary perspective on
management is the contingency approach, which argues that appropriate managerial
actions in a situation depend or are contingent on certain major elements of that
situation.
3. TQM (Total Quality Management) - is used here to refer to the entire quality
movement that has become ubiquitous in business organizations worldwide.
4. High-involvement management - includes not just all forms of participative
management but also a fundamentally different approach to management than has
been traditional. The traditional, control-oriented approach to management— which
is based on the assumption that hierarchical organizations represent the best way to
assure performance—will not easily be displaced. Nevertheless, many elements of
high-involvement management are already being tried in organizations around the
world. In many ways it seems that high involvement management would particularly
apply to small agribusinesses, which are typically nonhierarchical organizations.
High-involvement management relies much more on self-control and self-
management at the lowest levels of organizations. Quality circles, employee survey
feedback, job enrichment, work teams, quality-of-life programs, gain sharing, and
what are called new design plants are among the most common techniques being
tried.

Application:

1. Think of someone you know who is a manager. Describe that person’s management
position in terms of the type of organization in which he or she works, his or her level in the
organization, and the area of management in which he or she practices.

Assessment:

1. Make a personal reflection paper that would relate the concept of management to
your own management style towards your studies. (1 page only)