8/2/2019 Manacon Nov.15 Class
1/39
MANAGEMENTCONCEPTS
Teresita Flordeliz M. Ragudo, CPA, MM-BMAssistant Professor
School of Management and Entrepreneurship
De la Salle CanlubangLeandro V. Locsin Campus
1
8/2/2019 Manacon Nov.15 Class
2/39
If a man takes no thought what is distant, He will find sorrow
near at hand. He who will not worry about what is far
off will soon find something worse than worry.
CONFUCIUS
PLANNING &STRATEGIC MANAGEMENT
2
8/2/2019 Manacon Nov.15 Class
3/39
DevelopVisionand
MissionState-ments
PerformExternal
Audit
EstablishLong-Term
Object-ives
Generate,
Evaluate,and
SelectStrategie
s
ImplementStrategies-Manage-
mentIssues
ImplementStrategies-Marketing,Finance,
Accountin
g, R&D,and MISIssues
Measure and
Evaluat
ePerform
ance
PerformInternalAudit
Strategy FormulationStrategy
ImplementationStrategy
Evaluation
Source: David, Fred R. (2009) Strategic Management Conceptsand Cases
(12thedn). Philippines: Pearson Education South Asia PTE, Ltd.
8/2/2019 Manacon Nov.15 Class
4/39
Source:
Rue, L.W., and Bars, L.L. (2009) Management Skills andApplication
(13th edn). New York: McGraw-Hill/Irwin.
ORGANIZING4
8/2/2019 Manacon Nov.15 Class
5/39
Most of us fear change. Even when our minds say change is normal, our
stomachs quiver at the prospect. But for strategists and managers today, there isno choice but change.
ROBERT WATERMAN, JR.
ORGANIZING WORK5
8/2/2019 Manacon Nov.15 Class
6/39
What is an organization?6
An organization is a group of people workingtogether in concerted or coordinated effort toattain common objectives.
8/2/2019 Manacon Nov.15 Class
7/39
What is organizing?
C
ON
C
EP
T
The process of organizing is the grouping ofactivities necessary to attain common objectivesand
the assignment of each grouping to a managerwho has the authority required to supervise thepeople performing the activities.
Thus, organizing is basically a process of division
of labor accompanied by appropriate delegation ofauthority.
Proper organizing results in more effective use ofresources.
7
8/2/2019 Manacon Nov.15 Class
8/39
How is organizing done?
A
P
P
L
I
C
A
TI
O
N
Home Depot began as a three-storestart-up in 1979 and grew to a $45billion chain by 2000, making it
Americas fastest growing retailer over
that time period. In early 2000, HomeDepot hired Bob Nardelli from GE as
CEO following the retirement ofcofounders Bernie Marcus and ArthurBlank. Mr. Nardelli was selected tobring GE-style discipline and focus to
Home Depots management team.
8
8/2/2019 Manacon Nov.15 Class
9/39
How is organizing done?
A
P
P
L
I
C
A
TI
O
N
Over the next six years, Mr. Nardelliimplemented centralization policies tomake the company more efficient and
hence to save money. These policiesoften limited employees ability to makedecisions. Home Depot also hired moreand more part-timers. While Mr. Nardelliscentralization policies and part-timeemployees did save money, they alsoeroded the employees entrepreneurialspirit and had a negative impact oncustomer service. Mr. Nardelli resigned
amid pressure from stockholders in late
9
8/2/2019 Manacon Nov.15 Class
10/39
Organizing Work CaseAnalysis
How might takingaway employees
authority for makingdecisions have anegative impact onthe organization?
Suppose you are incharge of building ahomecoming displayfor your school with10 volunteers. Howwould you organizethem?
ANALYZING MANAGEMENT
SKILLS
APPLYING MANAGEMENT
SKILLS
10
8/2/2019 Manacon Nov.15 Class
11/39
ORGANIZING A HOMECOMING DISPLAY
11
1. First, meet with the person who has given you the assignment (was it the Dean, Coordinator of Student Affairs, thechancellor?). Ask for details like what would be the theme of the display, what are the things to put on display?
2. Second, meet with your group discuss with them the details, the expectations of the school management and what thingsneed to be done to come up to the expectations.
3. Then form groups, related or similar tasks and pooled in one group.
4. Ask who want to take charge of something. The volunteers are expected to handle tasks wherein they have a backgroundor at least a basic knowledge about. This is a democratic way of delegating the task among the volunteers.
5. Ask the groups to appoint their respective leaders.
6. Instruct the groups to lay-out a detailed plan of their activities including the resources needed to carry out the tasks.
7. Review their plan of action and if they are all in line with the instruction of the school management, make sure that eachtask is well understood by everybody, then instruct to proceed if ok.
8. All tasks must be time-bound. Monitor closely the progress of each group. If there are problems help them resolve thesituation or much better yet consult the school management for guidance
9. Should you have additional instructions to the group, your instructions should be given through the leaders. Do not godirect to the members of the group. In this sense you are observing the lines of authority. If you want the group leaders tobe responsible, then authority must also go with it. Say there is somebody in the group that is not doing his assignment ofrefusing to follow instruction, allow the group leader to handle it first, then if the situation is not resolved, talk to the groupleader, help him or her determine whats the best thing to do to handle the situation and if he/she tells you that he cant
handle it anymore, then ask for his permission for you to come into the picture.
10. Conduct meetings regularly, say every Monday of each week and when the event is too close, meet with the leaders everytwo to three days- to make sure that things are falling right into their places.
11. After the event, conduct a debriefing/evaluation. Discuss the event, identify the problems, flaws encountered related toyour assignment, if there were any. And try to resolve as if the the next homecoming will be forthcoming and you will stillbe the one to handle the homecoming display. And of course commend, praise, give a pat on the back to all whoperformed well and encourage those who didnt fair well enough. Avoid pointing fingers at who did it bad. Remember, to
those who are open minded and humble, there are always room for improvement.
12. If there failures, you have to accept the blame or own up responsibility to your boss, on the other hand, you do not own all
the praises, recognize the contributions of your people.
13. And if the school requires it, make a report on your assignment and offer recommendations on how to do it much better
8/2/2019 Manacon Nov.15 Class
12/39
ORGANIZING CONCEPTS
1. To establish linesof authority.
2. To attain synergy.
3. To improvecommunication.
1. VERTICAL- tall Authority and flow of
communication arethrough channelsusually severallayers within theorganization.
2. HORIZONTAL-flat Based on
specialization ofwork.
REASONS FOR ORGANIZING DIVISION OF LABOR
12
8/2/2019 Manacon Nov.15 Class
13/39
ORGANIZING CONCEPTS
JOB SCOPE
Refers to the number
of different types ofoperationsperformed on the
job
JOB DEPTH
Refers to the freedom
of employees toplan and organizetheir own work, workat their own pace,
and move aroundand communicateas desired.
13
8/2/2019 Manacon Nov.15 Class
14/39
ORGANIZING CONCEPTS
POWER
AUTHORITY
RESPONSIBILITY
Power is the ability to influence,command, or apply force.
Authority is power derived from
the rights that come with a positionand represents the legitimateexercise of power.
Responsibility is accountability forthe attainment of objectives, theuse of resources, and theadherence to organizational policy.
14
8/2/2019 Manacon Nov.15 Class
15/39
PRINCIPLES BASED ONAUTHORITY
DELEGATION
PARITYPRINCIPLE
EXCEPTIONPRINCIPLE
Delegation refers to the assigning ofauthority from one person to another.
The Parity principle states thatauthority and responsibility mustcoincide.
The exception principle (also known as
management by exception) states thatmanagers should concentrate theirefforts on matters that deviatesignificantly from normal and letsubordinates handle routine matters.
15
8/2/2019 Manacon Nov.15 Class
16/39
STEPS IN THE DELEGATION PROCESS
1. Analyze how you spend your time.
2. Decide which tasks can be assigned.
3.
Decide who can handle the task.4. Delegate the authority.
5. Create an obligation (responsibility).
6. Control the delegation
16
8/2/2019 Manacon Nov.15 Class
17/39
PRINCIPLES BASED ONAUTHORITY
UNITY OFCOMMAND
SCALARPRINCIPLE
SPAN OFMANAGEMENT
The Unity of Command Principlestatesthat an employee should have one, andonly one, immediate manager.
The Scalar Principle(chain of command)states that authority in the organizationflows through the chain of managers onelink at a time, ranging from the highest to
the lowest rank. The Span of Management(also called
the span of control) refers to the numberof subordinates a manager can
effectively manage.
17
8/2/2019 Manacon Nov.15 Class
18/39
18
FACTORS AFFECTING THE SPAN OFMANAGEMENT
FACTOR DESCRIPTION RELATIONSHIP TO
SPAN OF
CONTROL
Complexity Job scope, Jobdepth
Shortens span ofcontrol
Variety Number of differenttypes of jobs beingmanaged
Shortens span ofcontrol
Proximity Physical dispersion
of jobs beingmanaged
Lengthens span of
control
Quality ofsubordinates
General quality ofsubordinates beingmanaged
Lengthens span ofcontrol
Quality of manager Ability to perform Lengthens span of
8/2/2019 Manacon Nov.15 Class
19/39
Centralization versusDecentralization
Little authority isdelegated to lower
levels ofmanagement.
A great deal ofauthority is delegatedto lower levels ofmanagement.
The trend in todaysorganizations is toward moredecentralization.
Decentralization has thefollowing advantages:
i. allows more flexibility andquicker action,
ii. relieves executives fromtime-consuming detailwork, and
iii. results in higher morale byallowing lower levels ofmanagement actively
involved in the decision-making process.
19
CENTRALIZATION TODAYs TREND
DECENTRALIZATION
8/2/2019 Manacon Nov.15 Class
20/39
Centralization versusDecentralization
Potential loss of
control, Duplication of effort,
Higher
organizational cost, Established rules
may be bypassed.
Empowerment is a
form ofdecentralization thatinvolves givingsubordinates
substantial authorityto make decisions.
20
DISADVATAGES IN
DECENTRALIZATION
EMPOWERMEN
T
8/2/2019 Manacon Nov.15 Class
21/39
21
SCOPEOF
AUTHORI
TY
SCOPEOFAUTHORI
TY
PRESIDENT
BOARD OFDIRECTOR
S
VICEPRESIDEN
T
GENERALMANAGER
SUPERVISOR
EMPLOYEE
CENTRALIZED DECENTRALIZED
8/2/2019 Manacon Nov.15 Class
22/39
ELEMENTS OFEMPOWERMENT
Employees must beactively and willingly
engaged in their respectivejobs.
Employees must be givenpermission andencouragement toinnovate and not do thingsthe way they have alwaysbeen done.
Employees at every levelin the organization should
make decisions about whatkind of information theyneed to perform their job.
Employees must be heldaccountable for theiractions and the resultsachieved.
22
PARTICIPATIONACCESS TO
INFORMATION
INNOVATION
ACCOUNTABILITY
8/2/2019 Manacon Nov.15 Class
23/39
Other Trends in Organizations
- self-directed or self-regulatedwork teams,
- work units without a frontlinemanager,
- empowered to control theirown work,
- accomplish tasks within theirarea of responsibility withoutdirect supervision.
- A relatively new conceptwhereby two more part-timeemployees perform a job thatwould normally be held by
one full-time employee.
- allows employees to vary thehours worked each day aslong as they meet somespecific total, which is usually
40 hours per week.
- is the practice of working athome, being able to interactwith the office while traveling,or working at a satellite office.
23
Self-Managed WorkTeams FLEXTIME
TELECOMMUTING
JOB SHARING
8/2/2019 Manacon Nov.15 Class
24/39
SKILL-BUILDING EXERCISE24
Recently you have noticed that one of the staffmembers on the same level as your boss has beengiving you a hard time concerning your reports yousubmit to her. Having reviewed recent reports, you
have discovered few minor errors you should havecaught; but in your opinion, they are not significantenough to warrant the kind of criticism youve beenreceiving. Your boss and this particular manager havea history of bad relations, which may be one reason
for her attitude and actions.
As you think about how to best handle the situation,you consider these alternatives:
8/2/2019 Manacon Nov.15 Class
25/39
SKILL-BUILDING EXERCISE25
1. Talk to he manager in private and ask her why she is being socritical.
2. Do nothing. It is probably a temporary situation; to bring undueattention to it will only make matters worse.
3. Work harder to upgrade the reports; make sure there will be
nothing to criticize in the future. 4. Discuss it with your boss, but minimize or downplay the situation
by letting her know that you believe constructive criticism of thistype is usually healthy.
Other alternatives may be open to you, but assume these are the onlyones you have considered.
a. Without discussion with anyone, decide which of theseapproaches you would take now. Defend your choice.
b. What principle of organization most closely relates to thissituation?
c. To what extent do you think this is an organizing problem asopposed to a personality problem?
8/2/2019 Manacon Nov.15 Class
26/39
9 NOV. 2011
END OF CHAPTER 826
8/2/2019 Manacon Nov.15 Class
27/39
CHAPTER 8 ORGANIZING WORK
REVIEW QUESTIONS27
8/2/2019 Manacon Nov.15 Class
28/39
Source:
Rodriguez, R.A. and Echanis, E.S.2001.FUNDAMENTALS OF MANAGEMENT-TEXT &
PHILIPPINE CASES. Mandaluyong: Diwata Publishing, Inc.
HIERARCHIES IN ANORGANIZATION
28
15 November 2011
8/2/2019 Manacon Nov.15 Class
29/39
ORGANIZING29
Organizing is a necessary and important function of management.Except for the simplest tasks, most human undertakings such asrunning a business, a school, a hospital or a government bureauinvolves the conduct of many and varied sub-activities needed toaccomplish its objective.
Running a business, for example, usually involves such activities aspurchasing, selling, accounting, advertising, besides the basicproduction activities.
All such activities usually cannot be undertaken by one person,hence, it is necessary to subdivide these activities into work unitsthat may be performed by individuals or groups of individuals, andsubsequently to coordinate these activities together in some way.
This is the function of organizing. Organizing has been defined asthe process of identifying activities needed to accomplish a goal,subdividing and grouping these activities into meaningful units, and
assigning authority and responsibility to people for theiraccomplishment.
8/2/2019 Manacon Nov.15 Class
30/39
FORMAL ORGANIZATIONSTRUCTURES
30
In most large institutions, the subdivision andgrouping of the activities is done in a way which isboth explicit and stable over time.
This gives rise to formal organization structureswhich are usually depicted through organizationalcharts or table of organization.
In many organizations, such organizational charts
are usually supplemented by various otherdocuments detailing the job responsibilities of thevarious positions, and the relationships of thesepositions to others.
8/2/2019 Manacon Nov.15 Class
31/39
THE VALUE OF FORMALORGANIZATION STRUCTURES
A formal organization offers manyadvantages, especially to largeorganizations. These includemainly:
1. efficiency gains fromspecialization;
2. order arising from the clarity ofjob definitions;
3. reduction of unintended gapsor overlaps in the conduct of theactivities of the institution.
Organizations are usuallymultilayered or hierarchicalbecause of the limitations of asingle persons ability tosupervise others.
In the military for example, anarmy general has thousands ofsoldiers under his command, willnot be able to effectively overseethe activities of such a largenumber of people directly.
Thus, the soldiers are firstgrouped into squads headed bysquad leaders, and the squadsare in turn grouped into platoonsheaded by platoon leaders.
Platoons are grouped into
companies, which are headed bycompany commanders, whichcompanies are organized intobattalions, and so forth.
31
HIERARCHY IN THE
8/2/2019 Manacon Nov.15 Class
32/39
32
HIERARCHY IN THEMILITARY
BATTALIONCOMMAND
ER
COMPANYCOMMAND
ER
PLATOON
LEADER
COMPANYCOMMAND
ER
COMPANYCOMMAND
ER
SQUAD
LEADER
PLATOON
LEADER
PLATOON
LEADER
PLATOON
LEADER
PLATOON
LEADER
SQUAD
LEADER
SQUAD
LEADER
SQUAD
LEADER
SQUAD
LEADER
SQUAD
LEADER
SQUAD
LEADER
FOOTSOLDIER
S
FOOTSOLDIER
S
FOOTSOLDIER
S
FOOTSOLDIER
S
GROUPING IN AN
8/2/2019 Manacon Nov.15 Class
33/39
GROUPING IN ANORGANIZATION
The different activities inan organization arecommonly groupedtogether on thefollowing bases:
1. Function,
2. Product,3. Area or territory,
4. Client served, and5. Other bases such as
time or simplenumbers
Grouping by Function Most common method
in grouping of activitiessuch as:
1. marketing,2. production,3. Finance,
4. Personnel.
This groupingpromotesspecialization aim toattain efficiency.
33
8/2/2019 Manacon Nov.15 Class
34/39
34
A FUNCTIONAL ORGANIZATION
PRESIDENT &GENERALMANAGER
VP-FINANCE
VP-RESEARC
H
VP-MARKETIN
G
VP-PRODUCTI
ON
VP-EXTERNAL AFFAIRS
8/2/2019 Manacon Nov.15 Class
35/39
TABLE OF ORGANIZATION
ORGANIZING BYPRODUCT
ORGANIZING BYCUSTOMER
35
General
Manager
AnimalFeeds
Division
PoultryDivisio
n
FlourDivision
Store
Manager
MetroManilaBranch
Southern LuzonBranch
NorthernLuzonBranch
8/2/2019 Manacon Nov.15 Class
36/39
TABLE OF ORGANIZATION
ORGANIZING BY GEOGRAPHIC AREA
36
GeneralManager
MetroManilaBranch
SouthernLuzonBranch
VisayasBranch
NorthernLuzonBranch
MindanaoBranch
8/2/2019 Manacon Nov.15 Class
37/39
ORGANIZING THROUGHCOMBINATION OF VARIOUS CRITERIA
37
PRESIDENT
PRODUCT
B
PRODUCT
CPRODUCT A
FINANCEMARKETIN
GPRODUCTI
ON
LUZONPLANT
VIZ-MINPLANT
CONSUMER SALES
INDUSTRIAL SALES
8/2/2019 Manacon Nov.15 Class
38/39
MATRIX ORGANIZATION38
PRESIDENT
Manager of
Production
Manager of
Engineering
Manager of
Finance
Manager of
Personnel
Manager of
Projects
ProjectManager
1
ProjectManager
2
Engine-
eringGroup
Engine-
eringGroup
Personnel
Group
Personnel
Group
Finance &
Acctg.Group
Finance &
Acctg.Group
Production
Group
Production
Group
8/2/2019 Manacon Nov.15 Class
39/39
MATRIX ORGANIZATION
This form of organizationwas pioneered in theAmerican aerospaceindustries but has sincefound applications in the
more traditionalindustries as well.
A matrix structured iscreated when a project
or product structure issuperimposed acrossseveral functionaldepartments, resulting indual reportingrelationships for the
l i l d
In the matrix organization, theengineering, production, finance,and personnel groups are underthe supervision of, and reportingto, their respective functionalsuperiors i.e., the Engineering,Production, Finance, andPersonnel managers.
At the same time, however, thegroups from each functional
department are combined withgroups from other departmentsto form teams (the horizontalstructure) which are under thesupervision of a project manager.
Th lti t t
39