ABM 11 ORGANIZATIONAL MANAGEMENT REVIEWER

1. PLANNING – includes identifying the aims and purposes of the business, its tactics and developing
plans to incorporate and synchronize activities.
2. ORGANIZING - a function that ensures that each job or position is not duplicated and the
corresponding authority is properly identified with the responsibilities assigned to the person
concerned.
3. STAFFING – identifies the qualified potential employees.
4. DIRECTING (or LEADING/MOTIVATING) – refers to encouraging people to work towards the
attainment of the company’s goals and objectives.
5. CONTROLLING – involves evaluating the actual performance, compare it with the standards and
take the action needed.
 
1. First Line Managers (Supervisors) – administers the work of operating employees.
2. Middle Managers – administers the task of the supervisors and in his absence, the activities of the
operating employees.
3. Top Managers – they are in-charge for making company-wide decisions and setting purpose,
objectives and plans that affect the whole firm.

1. Technical Skills – refers to the expertise of the person in his area of specialization.
2. Human Skills – refers to how one can blend with other people.
3. Conceptual Skills – refers to the capability of the manager to conceptualize ideas for the entire
organization

1. Figurehead Role – managers perform traditional responsibilities.

2. Liaison Role – communicates with his head, peers, and people outside his organization.
3. Monitoring Role – he seeks important information that will be relevant in decision making. The
quality of the information will enable him to deliver sound decisions.
4. Dissemination Role – managers convey the messages received from the subordinates to members
of the organization.
5. Spokesman Role – managers convey the information or speaks on behalf of the whole organization
to outsiders.
6. Resource Allocation Role – he decides to who gets the resources.
7. Entrepreneurial Role – he initiates improvement changes.
8. Leader Role – he motivates people to perform better.
9. Disturbance Handler Role – he reconciles and put harmony in the workplace.
10. Negotiator Role – he ensures to get the best bargain in any negotiation.

 Frederick Taylor introduced this management theory at the time that there were shortages in
skilled labour at the start of the 20 th
 Taylor emphasized the importance of using the “One Best Method” in order to systematize the
process of creating a product. He also initiated the “Differential Rate System” wherein he
encouraged the owner of the company to increase the wages of workers who are considered to be
productive.

 HENRY GANTT – an associate of Taylor; he abandoned the “Differential Rate System” due to its
small incentive effect on production; he also initiated the charting system for production scheduling
 known today as the GANTT CHART. It refers to a table or diagram that reflects the status of the
stages of production.

 FRANK and LILIAN GILBRETH – this husband and wife team made a devise called
MICROCHRONOMETER. It is intended to identify the hand and body motions of a labourer primarily
to determine the length of time spend doing each motion.

 MAX WEBER – a German theorist who introduced BUREAUCRACY – a form of organization that
emphasized division of work, the rules and regulations, chain of command and impersonal work
relationship.

 MARY PARKET FOLLET – she stressed the significance of belonging to a group as a way for people to
grow in the organization.

 This was developed by Henri Fayol to address the issue as to how a complex company such as
factories can be managed efficiently and effectively.

 Fayol developed the 14 Basic Principles of Management:

1. Division of work – it involves specialization of the workforce by dividing a small part of work.   It
promotes mastery among the workers.
2. Authority and Responsibility – authority means the power or the right entrusted to make the work
possible; Responsibility means the duty of work assigned to a particular position. The two terms are
inseparable.
3. Unity of Command – there must only be one superior that gives directives/orders to employees to
avoid confusion.
4. Discipline – giving respect and comply with the policies of the organization.
5. Unity of Direction – an organization should have a single plan of action to guide its manager and
workers.
6. Subordination of Individual Interest Over General Interest – the welfare of the organization should
come first over that of the interest of an individual.
7. Remuneration – compensation must be fair.
8. Centralization – authority are concentrated at the top hierarchy of an organization.
9. Scalar Chain – refers to the sequence of positions from the highest to the lowest rank.
10. Order – people and materials should be in the right place at the right time.
11. Equity – respect, fairness, impartiality.
12. Stability of Tenure – organization should promote long term employment.
13. Initiative – subordinates exercising creativity without directives from subordinates. Managers
should encourage them to propose and execute their ideas or plans.
14. Esprit de Corps – French word which means “Unity is Strength”. Managers should promote team
spirit and each employee should be a team player.
 
Organization as a system Organizational system -‐ consists of an assortment of interacting mechanism 
(resources/people) that acquires inputs (goals) from the outside environments,  processes them
(structure and processes) and creates an output  (Product/services) to be consumed back by the outside
environment  (customers).
Business environment - The combination of both external and internal factors that affect a firm’s
operating condition. The business environment can comprise factors such as: suppliers and clients; its
competitors and owners; development in technology; legal, laws and government activities; and market,
economic and social trends.

1. Management-‐ This pertains to the organizational setup, including goals and  objectives,
organizational structure, managerial composition, company philosophy, visions, missions, policies,
programs, plans, strategies and tactics,  etc.

2. Marketing-‐ This includes the marketing program of the company covering the basic marketing
mix-‐product, price, place and promotion. Specific items falling under this force are product quality,
packaging, pricing, strategies, intermediaries used, advertising efforts, public relations, company
image and  reputation, distribution channels, “green marketing campaigns”, warehousing, 
discounts and other sales promotion tools, market segmentation, and a lot  more

3. Finance-‐ this includes the company’s resources. Items covered under this force are profitability
indices, financial performance, balance sheet and income statement results, and operating
expenses, among others

4. Production and Operations-‐ This includes all aspects of manufacturing (pertaining to industries) or
operations (for commercial and service enterprises). Specific items falling under this force are
quality and sources of raw materials, machinery and equipment, production efficiency, service
reliability, technical expertise, production credo, scheduling, delivery, sales service, maintenance,
factory location, etc.
  
5. Human Resources-‐ This aspect pertains to the people in the organization. Specifically, it includes
motivation, compensation, training and development, promotion, recruitment, selection,
placement, hiring policies and procedures, fringe benefits, performance appraisal, grievance
handling mechanisms,  management -‐labor relations, etc.

 External environment/Macro-‐environment

        It contains of the forces that are away from a company’s control. The macro-‐environment includes
the economic, the socio cultural, the political and legal, the technological, and the natural environment.
This affects entities, events, condition, and factors surrounding an organization that influence its choices
and actions, and find out its opportunities and risks. It is also called operating environment.

1. Economic Environment-‐ This environment includes such forces as balance of trade, balance of
payments, foreign exchange, import‐export situations, competitive situation, taxation, energy and
oil prices, employment, GNP, GDP,  per capita income, and other measures of economic
performance.
2. Socio Cultural environment-‐ This environment pertains to people and their culture. Examples of
forces under this type of external environment are education, customs and traditions, religious
affiliations, perception, cultural values, demography, ethnic and racial diversity, etc.
3. Politico Legal environment-‐ Politico pertains to government while legal pertains to law. This
environment includes legislation regulating business, legal restrictions, elections, political stability,
presidency, peace and order situation, armed forces, etc.
4. Technological environment-‐ This refers to the advancement of science and technology and
includes new inventions or discoveries, technological breakthroughs, research and development,
information technology, scientific experiments, etc.
5. Natural environment-‐This includes typhoons, earthquakes, the El Niῇo and La Niňa phenomena,
pollution, ozone depletion, deforestation, preservation and extinction of animal species. It is
important for a company to carefully evaluate and understand the aspect of both its internal and
external environments because it can affect their firm and how it should be run.

1. Sole Proprietorship – it is a business owned by only a single person. It is easy to set-‐ up and is the
least expensive among all forms of ownership. The owner of the business faces unlimited liability;
meaning, the creditors of the business may run after up to the personal assets of the business
owner if the business cannot pay them. The sole proprietorship form is typically adopted by small
business organization.
2. Partnership - it is a business entity operated and owned by two or more persons who contribute
possessions into the firm. The partners divide among themselves the profits and loss of the
business. In general partnerships, all partners have limitless liability. In limited partnerships,
creditors cannot run after to the personal assets of the limited partners.
3. Corporation – it is a business entity that has a separate legal personality from its owners.
Ownership in a stock corporation is represented by shares of stock. The owners (stockholders)
benefit from limited liability but have limited involvement in the company's operations. The board
of directors, an elected group from the stockholders, controls the activities of the corporation.
4. Cooperative – it is a business organization owned and operated by a group of individuals and is
created for their mutual support and benefit. The persons making up the group are called
members. Cooperatives may be incorporated or unincorporated.

        SWOT analysis matrix is a structured assessment tool used to evaluate an organization, industry, a
place or even a person in terms of a set of priorities like strengths, weaknesses, opportunities and
threats. (Albert Humphrey 1960).

Strengths – Is something that a company is good at doing, features that organizations possess. It
identifies what an organization excels at, allowing decisions on how to achieve a competitive and
significant advantage.
Weaknesses-‐ Are characteristics that a company lacks and put the firms at a disadvantage relative to
other business entities. It stops a business entity from performing at its best level. They have the
potential to reduce progress or to give a competitive advantage to the competitor. A business firm
needs to lessen weaknesses and analyze how they can be enhanced.
Opportunities and Threats (External Environment)
Opportunities – Are possibilities in the external environment that the organizations can utilize to their
advantage. It refers to favorable external factors that a company can use to its benefit. If successfully
utilized, opportunities have the potential to create a competitive advantage.
Threats-‐Are challenges in the external environment that can cause an eminent problems to a business
firms. It refers to aspects that have the potential disadvantage impact to an organization
Organization - a collection of people working together to achieve a common purpose.
Business Organization - a collection of people working together to achieve a common purpose in
relation to their organization's  mission, vision, goals and objectives, sharing a common organizational
culture.

Organizational Culture - the set of beliefs and values shared by organization members which guide them
as they work together to achieve their common purpose.

Planning Techniques & Tools

⮚⮚ Robins & Coulter, 2011 identified three methods that have been developed to help managers
execute the planning function:

❑❑ Environmental Scanning – examines the large amount of information to predict and infer changes
in the environment.

        ∙ Competitor intelligence – it seeks to classify who are the business competitors, its’ strength and as
to how their actions will influence the organization. Forecasting – predictions of outcomes

❑❑Forecasting -‐ prediction of outcomes 

Two categories:

1. Quantitative forecasting – applies a set of mathematical rules to a series of past data to predict
outcomes.
2. Qualitative forecasting – It uses the judgment and opinions of knowledgeable individuals to predict
outcomes.
3. Benchmarking – the search for the best practices among the competitors or non-‐competitors that
lead to their superior performance.
4. Orientation towards goals-‐ all business organization has its own purposes and objectives.
Organizing is arranging and structuring work to accomplish an organization’s goals. Organization
harmonizes the individual objectives of the employees with overall goals of the firm.
5. Composition of individuals and groups-‐ Individuals create a group and the groups form an
organization. Hence, organization is the combination of individual and groups. Individuals are
grouped into departments and their work is coordinated and directed towards organizational
goals.
6. Continuity-‐ An organization is a group of people with a definite connection in which they work
together to achieve the goals of the organization. This connection does not come to conclusion
after finishing each task. Organizing is a never ending process.
7. Division of work and specialization-‐ The complete thinking of organization is focused on the
concepts of work specialization and division of work/labor. The division of work is breakdown of
jobs into narrow and repetitive tasks handing over responsibility for each organizational element
to a specific individual or group thereof. It becomes work specialization when the job for a
specific task lies with a chosen expert in that field. The efforts of the people are coordinated to
allow the process at hand to work correctly. Certain individuals occupy positions of management
at various level in the process to make sure proper coordination. However, when an employees
carried too much specialization, they may feel bored, isolated and a problems of stress, fatigue,
including poor quality or work, absenteeism and employee turnover will be increased. That is
 why many organizations enlarge jobs or rotate assigned tasks to provide greater challenges and
opportunities for growth.

Authority - refers to the right inherent in a managerial position to tell people what to do and to expect
them to do it. Managers in the chain of command have authority to do their job of coordinating and
overseeing the work of others.

Responsibility - means an employee's obligation or expectation to perform any assigned duties or

activities.

Accountability - is the requirement to show performance results to a supervisor in the chain of

command.

1. Assign responsibility -‐ explain task and expectations

2. Grant authority -‐ allow others to make decisions and act
3. Create accountability -‐ require others to report back on results