Business Plan: Organizational/ Administration Plan

ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP
ORGANIZATIONAL PLAN
BUSINESS PLAN:
ORGANIZATIONAL/
ADMINISTRATION
PLAN
ORGANIZATIONAL PLAN
DEFINITION OF MANAGEMENT
• Management is “the art of getting things done through
other people” - Mary Parker Follet -
• A process of planning all the resources efficiently,

organized the resources effectively, leading then
controlling the resources.
• Resources here refer to capital, manpower, technology

and materials.
ORGANIZATIONAL PLAN
FUNCTIONS OF MANAGEMENT
Planning
• A proper planning need to be developed in order to

make sure all the resources is being fully utilized.
• Planning involved goal setting and defining the

action those need to be taken in order to achieve
goals.
ORGANIZATIONAL PLAN
CONT…
• Managers that involved in planning require knowledge
of the company, information on the factors of the
environment, e.g. economic condition, good judgment
in reducing risk and decision making.
ORGANIZATIONAL PLAN
CONT…
Organizing
• Organizing involves determining the task to be done,

who will do them and how those task will be managed
and coordinated
• The manager’s role in this situation is to coordinate

the effort of the workers of different task and create
the conditions to find solutions.
ORGANIZATIONAL PLAN
CONT…
Directing/Leading
• Managers must be also capable of leading their

subordinates to work together to achieve the
organization goals.
• Effective managers must try to understand individuals

and group behavior, be able to motivate and discuss
with their subordinates
ORGANIZATIONAL PLAN
CONT…
Controlling
• Controlling is to identify between planned and actual

result, whether the organization is performing as what
had been planned.
• If the organization is not going towards the goal,

corrective action need to be taken in order to adjust the
plan to the existing situation
ORGANIZATIONAL PLAN
BUSINESS VISION
• A vision statement describes what the organization
aspires to be in the long term.
• It is a description of the way in which the business wants

to be perceived by others at some future date.
• For example, TNB vision is “To be among the Leading

Corporations in Energy and Related Businesses
Globally"
ORGANIZATIONAL PLAN
BUSINESS MISSION
• Many businesses also have mission.
• Mission statements are statements of how

entrepreneurs will achieve their purposes in the
environments in which they conduct business.
• It is also the reason why an organization exists.
• For example, TNB mission is “We Are Committed to

Excellence in Our Products and Services”
ORGANIZATIONAL PLAN
BUSINESS OBJECTIVES
• It is the starting point in effective management.
• Defined as what does a business hopes and plan to achieve.
• In other word, goals are performance target.
• Goals differ from business to business depending on its purpose

and mission.
• Any business functions systematically because it sets goals and

plan accordingly.
ORGANIZATIONAL PLAN
GOAL SETTING
• Purposes
• To provides direction and guidance for all

entrepreneurs
• To help firms allocate resources
• To define corporate culture
• To help entrepreneurs assess business performance

ORGANIZATIONAL PLAN
Guideline for goal setting :

SMART Concept
S= Specific
M= Measurable
A= Achievable
R= Realistic
T= Time frame
ORGANIZATIONAL PLAN
TYPES OF GOALS
• Long term goals relate to extended period of time,
typically five years or more.
• Intermediate goal are set for a period of one to five

years.
• Short term goal are set for perhaps one year and are
develop for several different areas.
ORGANIZATIONAL PLAN
ORGANIZATIONAL STRUCTURE
Organizational structure depends on the needs of the
organization.
The steps are:
1.List all the work needed to be done in the organization
2.Group the work or job into section, unit or department
3.Construct diagrammatically through organizational chart

ORGANIZATIONAL PLAN
ORGANIZATIONAL CHART
Organizational chart shows;
• Job position
• Hierarchy
• Span of control
ORGANIZATIONAL PLAN
TYPES OF ORGANIZATIONAL STRUCTURE

• Function – business that emphasize functional specialties to perform tasks
• Product – more practical for business that produce multiple products
• Client – business that have several outstanding clients that contribute to most of the
company’s sales turnover.
• Number of workers - business that has a large number of workers
• Region – business companies operating in more than one location
• Shifts – business that operate on multiple operation hour

ORGANIZATIONAL PLAN
ORGANIZATIONAL STRUCTURE-
FUNCTION
ORGANIZATIONAL PLAN
PRODUCT
ORGANIZATIONAL PLAN
CLIENT / CUSTOMER
ORGANIZATIONAL PLAN
NUMBER OF WORKERS
ORGANIZATIONAL PLAN
REGION
ORGANIZATIONAL PLAN
SHIFTS
ORGANIZATIONAL PLAN
PREPARING AN ORGANISATIONAL
PLAN
The steps in preparing an organizational plan
for a business:
1. The introduction to the organization
2. To develop an organization chart
3. To prepare a list of administration personnel

ORGANIZATIONAL PLAN
4. To develop a schedule of tasks and responsibilities
5. To develop a schedule of remuneration
6. To determine the office equipment and supplies
7. To prepare an administration budget

ORGANIZATIONAL PLAN
1.Introduction to the organisation
For the introduction, state the vision, mission and

objectives of the business organisation.
• Business vision helps to prepare a small business to plan for the

future and to achieve what it aspires to be.
• Business mission is a statement that shows the purpose or
reasons for its existence.
• Business objectives are short term planning characterised by a
more specific statements and with definite time frame. Use
SMART concept.
• Also include the following: business address, location plan, type
of building and infrastructure.
ORGANIZATIONAL PLAN
2.Develop an organization chart
Based on the structure of business, develop an organizational

chart that best suits the organization. The chart portrays the
hierarchy and chain of command of personnel in an
organization at a particular point of time. The most commonly
used organizational structure by a small business is the line
structure which is based on :
• Shifts
• Number of workers
• Functions
• Products
• Regions
• Clients
ORGANIZATIONAL PLAN
3.The preparation of Administration personnel
At this stage, lists all the personnel involved in the administration

section of the business and those personnels who are not
directly involved in operation (i.e. indirect workers).
Using a two column table, indicate the personnel position in one

column and the number of personnels in the second
column.
ORGANIZATIONAL PLAN
The table is as illustrated below:
TABLE 1: LIST OF ADMINSTRATION PERSONNEL
POSITION NO. OF PERSONNELS

ORGANIZATIONAL PLAN
4. Develop a schedule of Tasks and Responsibilities
The next step is to prepare a schedule of tasks and responsibilities.

For
each personnel position explain its main tasks and responsibilities.
This may be illustrated by drawing a two column table as in TABLE 2.
Then depict all the positions that have been described in TABLE 1
into
Column one of TABLE 2.
In column two, explain the tasks and responsibilities of each position.

ORGANIZATIONAL PLAN
TABLE 2: SCHEDULE OF TASKS AND RESPONSIBILITIES
POSITION TASKS AND RESPONSIBILITIES

ORGANIZATIONAL PLAN
5.Develop a Schedule of Remuneration
The remuneration of each personnel of all indirect workers has to be

taken into consideration beforehand. The remuneration includes
monthly salary or contractual wages, (daily, weekly or on
project basis) and all provident fund contribution as well as work
related insurance.
Take note that provident fund contribution to EPF by employers is

12% (subject to regulatory changes) of base pay. Meanwhile,
SOCSO contribution will be based on an average of 2.5% of
personnel’s monthly salary not exceeding RM2000.
It would be made clearer, if a schedule of remuneration is developed

as below:
ORGANIZATIONAL PLAN
TABLE 3: SCHEDULE OF REMUNERATION
POSITION NO. MONTHLY SALARY EPF SOCSO TOTAL

(RM) (RM) (RM) AMOUNT(RM)
(A) (B) (C) (A)+(B)+( C)
ORGANIZATIONAL PLAN
6.Determine the Office Furniture and Fittings

The business owner is to list all the office furniture and equipment
that are necessary for the administration section. It is also
necessary to include all office supplies. In addition, the owner
should also survey and check on the prices of the office
equipment and supplies in order to spend within the
administration needs.
ORGANIZATIONAL PLAN
Develop a list of office furniture and fittings as shown below.

(Note: Also a prepare a separate list of office supplies. Example:
Office stationeries)
TABLE 4: LIST OF OFFICE FURNITURE AND FITTINGS
TYPE PRICE /UNIT QUANTITY TOTAL AMOUNT

(RM) (RM)
ORGANIZATIONAL PLAN
7.The Preparation of The Administration Budget
Upon the determination of the administration expenses classify the

items into the following categories:
 Capital Expenditures/ Fixed Asset Cost

 Working Capital/Monthly Expenses
 Other Expenses
ADMINISTRATION BUDGET
ORGANIZATIONAL PLAN
ITEMS FIXED MONTHLY OTHER
ASSET EXPENSES EXPENSES
Land & Building xx

Furniture & Fittings xx
Vehicle(office use) xx
Renovation xx
Salary (EPF & SOCSO) xx
Rent xx
Utilities xx
Office Supplies xx
Business Registration xx
Business Licence/Permit
Deposit xx
Professional Fees xx
Road Tax/Insurance xx
Courses Attended xx
xx
TOTAL
ORGANIZATIONAL PLAN
THE END!

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ENT/ETR300 – FUNDAMENTALS OF ENTREPRENEURSHIP

• A process of planning all the resources efficiently,

• Resources here refer to capital, manpower, technology

• A proper planning need to be developed in order to

• Planning involved goal setting and defining the

• Organizing involves determining the task to be done,

• The manager’s role in this situation is to coordinate

• Managers must be also capable of leading their

• Effective managers must try to understand individuals

• Controlling is to identify between planned and actual

• If the organization is not going towards the goal,

• It is a description of the way in which the business wants

• For example, TNB vision is “To be among the Leading

• Mission statements are statements of how

• It is also the reason why an organization exists.

• For example, TNB mission is “We Are Committed to

• Defined as what does a business hopes and plan to achieve.

• In other word, goals are performance target.

• Goals differ from business to business depending on its purpose

• Any business functions systematically because it sets goals and

• To provides direction and guidance for all

• To help firms allocate resources

• To define corporate culture

• To help entrepreneurs assess business performance

Guideline for goal setting :

• Intermediate goal are set for a period of one to five

The steps are:

1.List all the work needed to be done in the organization

2.Group the work or job into section, unit or department

3.Construct diagrammatically through organizational chart

TYPES OF ORGANIZATIONAL STRUCTURE

• Product – more practical for business that produce multiple products

• Number of workers - business that has a large number of workers

• Region – business companies operating in more than one location

• Shifts – business that operate on multiple operation hour

1. The introduction to the organization

2. To develop an organization chart

3. To prepare a list of administration personnel

4. To develop a schedule of tasks and responsibilities

5. To develop a schedule of remuneration

6. To determine the office equipment and supplies

7. To prepare an administration budget

1.Introduction to the organisation

For the introduction, state the vision, mission and

• Business vision helps to prepare a small business to plan for the

2.Develop an organization chart

Based on the structure of business, develop an organizational

3.The preparation of Administration personnel

At this stage, lists all the personnel involved in the administration

Using a two column table, indicate the personnel position in one

The table is as illustrated below:

TABLE 1: LIST OF ADMINSTRATION PERSONNEL

POSITION NO. OF PERSONNELS

4. Develop a schedule of Tasks and Responsibilities

The next step is to prepare a schedule of tasks and responsibilities.

This may be illustrated by drawing a two column table as in TABLE 2.

In column two, explain the tasks and responsibilities of each position.

TABLE 2: SCHEDULE OF TASKS AND RESPONSIBILITIES

POSITION TASKS AND RESPONSIBILITIES

5.Develop a Schedule of Remuneration

The remuneration of each personnel of all indirect workers has to be

Take note that provident fund contribution to EPF by employers is

It would be made clearer, if a schedule of remuneration is developed