Business Management

Marc Lewis A. Brotonel

Instructor, Tanauan Institute
Concept
• Management is a very popular term and has been
used extensively for all types of activities and
mainly for taking charge of different activities in any
enterprise.
• Thus, management has to see that tasks are
completed and goals are achieved (i.e.,
effectiveness) with the least amount of resources at
a minimum cost (i.e., efficiency).
Management, has therefore, been defined as a process of getting things
done with the aim of achieving goals effectively and efficiently.

“Management is the process of designing and maintaining an

environment in which individuals, working together in groups, efficiently
accomplish selected aims.”
Harold Koontz and Heinz Weihrich

“Management is defined as t he process of planning, organising,

actuating and controlling an organisation’s operations in order to achieve
coordination of the human and material resources essential in the
effective and efficient attainment of objectives.”
Robert L. Trewelly and M. Gene Newport
 Characteristics of Management

• Management is a goal-oriented process

• Management is all pervasive
• Management is multidimensional
– Management of work
– Management of people
– Management of operations
• Management is a continuous process
• Management is a group activity
• Management is a dynamic function
• Management is an intangible force
 Importance of Management

• Management helps in achieving group goals

• Management increases efficiency
• Management creates a dynamic organisation
• Management helps in achieving personal objectives
• Management helps in the development of society
 Role of Business

Input Process Output

 Business

Businesses exist to satisfy the needs and

wants of people, organizations and
governments
 Adding Value

Adding value is increasing price of the

products by improving packaging or adding
features

It leads to profit making by allowing a business

to sell its products
for more than its production costs
 Opportunity Cost

• This next best alternative foregone while making a

choice is known as Opportunity Cost

• Because of the fact that choice involves

opportunity cost, the factors of production have to
be used in the most efficient way and therefore
SPECIALIZATION
 Division of Labor

• The separation of a work process into a number of

tasks, with each task performed by a separate
person or group of persons.
 Business Functions

► Human Resources
(Personnel)
► Marketing
► Finance
► Production
(Operations)
 Human Resources

► Manpower Planning ► Training and Development

► Job analysis and Job
description
► Determining wages and
salaries
► Recruitment and Selection
► Employee welfare and
motivation
► Labour management
relations
► Performance Appraisal
 Marketing

► Conducting Market ► Product Planning

Research
► Distribution Planning
► Price Planning
► Consumer Analysis
► Customer Relationship
Management
► Identifying New Business
Opportunities
 Finance

► Advice on the financial and tax implications of

business decisions
► Management of wages
► Raising Finance
► Preparation and monitoring of annual budgets and forecasts
 Production

► Production and planning

► Purchasing department
► Stores department
► Manufacture of products
► Design and technical support department
 Business sectors

Primary Tertiary

Secondary
Quaternary
 Primary sector

► Larger sector in underdeveloped &

developing countries
► Less capital investment
► Less use of machinery
► Agriculture constitutes the major part
 Secondary sector

► Takes the output of the primary sector and

manufactures finished goods
► Important sector to promote economic growth and
development
► Important source of income in developing countries
 Tertiary sector

► Significant contribution to GDP in developed

countries
► Provides key inputs to most other business
► Transformation of goods through providing services
 Quaternary Sector

The portion of an economy that is based on knowledge applicable

to some business activity that usually involves the provision of
services

Examples: Consultancy (offering advice to businesses) and

R&D (research, particularly in scientific fields)
Interpersonal roles
1. Figurehead - Symbolic leader of the
organization performing duties of social and
legal character
2. Leader - Motivating subordinates, interaction
with them, selection and training of employees
3. Liaison - Establishing contacts
with managers and specialists of other divisions
and organizations, informing subordinates of
these contacts
Informational roles
1. Monitor (receiver) - Collecting various data
relevant to adequate work
2. Disseminator of information - Transmitting
information obtained from both external
sources and employees to interested people
inside the organization
3. Spokesperson - Transmitting information
on the organization’s plan’s, current situation
and achievements of the divisions to outsiders
Decisional roles
1. Entrepreneur - Seeking opportunities to
develop processes
2. Disturbance handler - Taking care of
the organizations, correcting ongoing
activities,
3. Resource allocator - Deciding on
expenditure of the organization’s
physical, financial and human
resources
4. Negotiator (mediator) - Representing
the organization in all important
negotiations
 Role of Entrepreneurship

► Bringing together the factors of production

► Contributes towards growth of
economy
► Reduces unemployment
 Intrapreneurship

Giving opportunity to a person within a large corporation to take

direct responsibility for turning an idea into a profitable finished
product through assertive risk-taking and innovation
 Start-up cost of business

► Premises
► Buildings
► Capital equipment
► Marketing costs
► Legal and professional fees
Factors to consider when setting
up business:
► Business idea
► Finance
► Human resources
► Entrepreneurial skills
► Fixed assets
► Suppliers
► Customers
► Marketing
► Legalities
 Reasons for starting business

► Growth
► Earnings
► Autonomy
► Security
► Hobbies
 Challenges of start-up business

► Obtaining Finance
► Market potential
► Cash flow problems
► Customer Loyalty towards other brands
► Regulations
► Finding the right staff
► Uncertainty
Elements of Business Plan