Organization and

Management
 Lord, we praise and glorify Your Holy
Name. Forgive us from our sins that separate
us from Your love. Thank You for the gift of
life, family, health and security. Help us
understand that everything around us matters.
Bless our families and our homes. All this we
pray in the name of Jesus Christ our Savior.
Amen.
Learning Objectives:
 compare and contrast the legal forms of business
organizations;
 analyze various forces/elements influencing business
environment using PEST and SWOT strategies; and
 relate the phases of economic development to a town’s
local economy.
G S U P P L I E R M
S O Z D D G N C C A
B C U I K E T O U L
F I Y E N N E N L T
P A R T N E R O T H
I L H R P R N M U U
P W U A K A A I R S
G Q G L C L L C E I
C U S T O M E R T A
R E S O U R C E S N
Forms of Business
Organizations
Sole Proprietorship
 a one-person business
 the easiest and simplest business
enterprise to organize
 gives the owner the means to control the
business from his/her personal interests
 owner is the same economic unit as the
business (recognized as one)
 unlimited liability (the debts of the
business organization can be charged to
the owner)
 owner receives all profits and losses and
is liable for all obligations of the business
 The owner, not the business, is taxed.
 easily dissolved
 may end when the owner wishes to or at
the owner’s death or incapacity
 Examples of sole proprietorship are sari-
sari stores, computer shops and small-
scale business enterprises.
Partnership
 owned by two or more persons who agreed to
bind themselves to contribute money, property
or industry to a common fund with the
intention of dividing profit and loss among
themselves upon agreed formula
 owners, not business, are taxed
 dissolved when a partner wishes to or
when a partner leaves or dies.
 Examples of partnership in Nueva Ecija
are Garcia, Mercado & Associates and
Sigma Accounting Partners.
General partnership
 All partners contribute resources to the business
and are jointly and solidarily liable for the
obligations of the business enterprise.
 All partners are considered as agents of the
business.
Limited partnership
 A general partner acts as the manager. He/She is
also personally liable for the partnership’s debts.
 A limited partner has minimal control over the
business. He/She is not personally liable for the
partnership’s debts.
Corporation
 acquires a juridical personality upon formal
registration and recognition with the Securities
and Exchange Commission
 legally separated from its owners (files and
pays its taxes separate from the owners)
 limited liability (in the case of settling
obligations, the corporation is not allowed to
pay using the owners’ personal assets)
 Ownership is easily transferred
 lifespan of 50 years
 Examples of corporations are SM Investments
Corporation, BDO Unibank Incorporated and
Jollibee Foods Corporation.
Cooperative
 a corporation which advocates equality of
rights and privileges among all owners
 owned and operated democratically by its
member
 Members pool resources together to provide
for themselves and their patrons with goods,
services and other benefits.
 provides democratic control based on “one
member, one vote” policy
 Some examples of cooperative are Nueva Ecija
Electric Cooperative, Cooperative Rural Bank
of Bulacan and PLDT Employee’s Credit
Cooperative Inc.
Forces or Elements of the
Firm’s Environment
General Environment
 the level of organization’s external
environment that may affect the organization
 do not directly affect the organization, but
somehow affect its decisions
Political/Legal element
 refers to government affairs and laws or regulations
 includes political stability, trade restrictions, foreign
trade, tax, labor, environmental and health policies and
more
 The business organizations comply with the rules and
regulations set by the government
Economic element
 refers to the use and allocation of scarce resources in the
economy to create and distribute wealth
 includes GNP and GDP, interest rates, exchange rates, inflation,
employment, disposable income of consumers and more
 The business organizations try to suit with the local and
national economic status.
Social element
 refers to societal characteristics
 includes population growth, age distribution, health
consciousness and career attitudes
 The business organizations conform to the culture
and tradition of the society.
Technological element
 refers to new tools, ideas and approaches used by businesses
 includes new ways of producing goods and services and new
ways of communication within and outside the organization
 The business organizations choose a faster, easier and lighter
way of executing work.
Operating Environment
 the level of organization’s external
environment that has direct and immediate
impact on the organization
 affect the management of business through the
degree of change and complexity each element
represents
Customer element
 refers to individuals and entities who buy goods and
services produced by the organization
 The business organizations base their decisions on
the demand and behavior of customers.
Supplier element
 refers to individuals or entities that provide goods
and services needed by the organization in the
production of output
 The business organizations depend their supply on
the raw materials provided by suppliers.
Competitor element
 refers to those whom the organization monitors and
responds to in the battle for resources or market
 The business organizations keep up with their
competitors for a healthy competition in the market.
Pressure groups element
 refers to special-interest groups which set up to try
to influence what they think about the business and
its environment
 The business organizations change their actions and
behavior according to the pressure group’s interests.
Internal Environment
 the level of environment that is within the
organization
 Organization structure determines how the roles, power
and responsibilities are assigned, controlled and
coordinated.
 Corporate culture consists of values and beliefs that
organization members have.
 Resources include human resources, finances,
production technology and physical facilities.
Phases of Economic
Development
 Economic Development is the process by
which a nation improves the economic,
political and social well-being of its people.
Malthusian Theory
 proposed by Thomas Robert Malthus
 states that economic growth depends on the rate of the
population of a certain area
 The economic growth is inversely proportional to the
population.
 The smaller the population, the higher the economic growth and
vice versa.
Government - LED (Local Economic Development)
 an approach towards economic development which
allows and encourages local people to work together to
achieve sustainable economic growth and development
 supports the formation of a partnership between local and
national institutions towards strategic implementations
A la Kuznets
 proposed by Simon Kuznets
 implies that as a nation undergoes industrialization
and mechanization of agriculture, the center of the
nation’s economy will shift to the cities
Human Capital Based
 a measure of the economic value of an employee’s skill
set
 refers to the knowledge, skill sets and motivation that
people have, which provide economic value
 could be invested in through education, training and
enhanced benefits that lead to an improvement in the
quality and level of production
Post Demographic Transition
 the transition from high birth and death rate to lower
birth and death rate as the country develops from
pre-industrial to an industrialized economic system
Mary Mother of the Good Shepherd, pray
for us.
Jesus, You are my Lord,
my happiness lies in You alone.