MODULE: COOPERATIVE MANAGEMENT

A. COURSE OUTLINE FOR HALF OF THE SEMESTER SESSION: (March-May 2020)

TOPIC
Learning outcomes Assessment criteria Indicative content
A. TYPES AND A.1. Familiarize on  TYPES OF COOPERATIVES
SERVICES; types, services 1. Credit Cooperative
CATEGORIES OF and categories of 2. Consumer’s Cooperative
COOPERATIVES cooperatives 3. Producer’s Cooperative
4. Marketing Cooperative
5. Service Cooperative
6. Multipurpose Cooperative
7. Advocacy Cooperative
8. Agrarian Reform Cooperative
9. Cooperative Bank
10. Dairy Cooperative
11. Education Cooperative
12. Electric Cooperative
13. Financial Service Cooperative
14. Fishermen Cooperative
15. Health Services Cooperative
16. Housing Cooperative
17. Insurance Cooperative
18. Transport Cooperative
19. Water Service Cooperative
20. Worker’s Cooperative
21. Other types of cooperative
22. as may be determined by the CDA

 CATEGORIES OF COOPERATIVES. - Cooperatives

shall be categorized according to membership and
territorial consideration as follows:
a) In terms of Membership-Cooperative shall be
categorized into:
a.1) Primary - The members of which are natural
persons;
a.2) Secondary - The members of which are primaries;
and
a.3) Tertiary - The members of which are secondary
cooperatives;
b) In terms of Territory - Cooperatives shall be categorized
according to areas of operations which may or may not
coincide with the political subdivisions of the country.
A.2. Enumerate  Please access the list of registered cooperatives
registered (Cooperative Development Authority - Cooperative
cooperatives in the Masterlist) at
Philippines and https://www.cda.gov.ph/2-uncategorised/274-masterlist-
identify their cooperatives
category, types
and services
provided for their
members and non-
members.
B. COOPERATIVES IN B.1. Discuss  Cooperatives have unique advantages based on the
THE MODERN contributions of special relationship they have with their members as
MARKETPLACE/ cooperatives in well as with the community they live in. They have the
community power to consolidate demand and purchase supplies at
COOPERATIVE IN
development cheaper prices than their competitors.
COMMUNITY
DEVELOPMENT
The cooperative form of enterprise operates across
many sectors of the economy empowering
members and building more sustainable and resilient
communities.
Table 1 below summarizes the findings by categorizing the
impact on job creation by the type of cooperative and
geographic representation.

B.2. Identify some  Please get access to https://www.cda.gov.ph/2-

cooperatives with uncategorised/274-masterlist-cooperatives
their contribution
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 to community/  Cooperative Development Authority - Co-op Stories
social concern www.cda.gov.ph › resources › updates › featured-
coop...

C. GOVERNANCE OF C.1. Familiarize on  Governance of cooperatives is rooted in the

COOPERATIVES operation of international governance principles of cooperatives. It
cooperatives should be noted that cooperative governance consists
of a three-tiered system: General Assembly (decision-
making body), Board of Directors (policy-making body)
and Management (day-to-day operations).
1. External governance relates to how cooperatives
apply the legal and regulatory obligations placed on
them.
2. Internal governance practices relate to the principles
and values adopted by the International Co-operative
Alliance (ICA) in the course of management of the
cooperatives. Internal governance also requires
compliance with the bye-laws or rules, policies,
procedures; they are bound by law to place the best
interests of the cooperatives foremost. Secondly, they
must meet the fit and proper requirements of the Act
and Regulations.
D. COOPERATIVES D.1. Compare and  Economy refers to the social institution through which a
AND MOJOR contrast some society’s resources (goods and services) are managed.
ECONOMIC economic system The Agricultural Revolution led to development of the
SYSTEM in relation to first economies that were based on trading goods.
cooperative Mechanization of the manufacturing process led to the
Industrial Revolution and gave rise to two major
competing economic systems. Under capitalism,
private owners invest their capital and that of others to
produce goods and services they can sell in an open
market. Prices and wages are set by supply and
demand and competition. Under socialism, the means
of production is commonly owned, and the economy is
controlled centrally by government. Several countries’
economies exhibit a mix of both systems. Convergence
theory seeks to explain the correlation between a
country’s level of development and changes in its
economic structure.

B. CLASSROOM ACTIVITIES/ ALTERNATIVE OUTSIDE OF CLASSROOM ACTIVITIES

General Instructions:
B.1. Answer all the activities independently.
B.2. Put your answer in a legal size bond paper (8.5 x 13’)
B.3. If you are in doubt, please inform me.

A. TYPES AND SERVICES; CATEGORIES OF COOPERATIVES

1. How can the cooperative be the way through which a person can help himself and others for development?
2. In terms of Membership-Cooperative shall be categorized into: Primary, Secondary and Tertiary cooperatives. What do you think are
reasons why a Primary cooperative necessitates to a secondary or tertiary membership?

B. COOPERATIVES IN THE MODERN MARKETPLACE/ COOPERATIVE IN COMMUNITY DEVELOPMENT

1. Based on your research readings, identify and make a narrative report for at least two successful cooperatives in the Philippines.
2. Discuss some of the reasons and issues why some cooperatives succeed and fail.

C. GOVERNANCE OF COOPERATIVES
1. Illustrate and explain your ideal cooperative organizational structure.
2. As a person, can you become a good member to a cooperative?

D. COOPERATIVES AND MOJOR ECONOMIC SYSTEM

1. Explain the difference between state socialism with central planning and market socialism.
2. In what ways can capitalistic and socialistic economies converge?
3. Describe the impact a rapidly growing economy can have on families.

Prepared by: Approved by:

LAARNI B. VELASCO, MBA RUTH ANN MARIE A. AQUINO, MPA

BSBA-FM Chairperson CBEA Dean

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 COOPERATIVE MANAGEMENT
BAYANGAN, KYNA NICOLE CC.
BSBA- FM 2A

A. TYPES AND SERVICES; CATEGORIES OF COOPERATIVES

1. How can the cooperative be the way through which a person can help himself and others for development?
- A cooperative is an autonomous and duly registered association of persons, with a common bond of
interest, who have voluntarily joined together to achieve their social, economic and cultural needs and
aspirations by making equitable contributions to the capital required, patronizing their products and services
and accepting a fair share of risks and benefits of the undertaking in accordance with the universally
accepted cooperative principles. By the goals and objectives of a cooperative it can help a member or a
person to develop himself and to become successful, with the primary objective of every cooperative is to
help improve the quality of life of its members.

2. In terms of Membership-Cooperative shall be categorized into: Primary, Secondary and Tertiary cooperatives.
What do you think are reasons why a Primary cooperative necessitates to a secondary or tertiary membership?
- Primary cooperative necessitates to a secondary or tertiary membership in order to reach the wants of every
person who are willing to be part of a cooperatives.

B. COOPERATIVES IN THE MODERN MARKETPLACE/ COOPERATIVE IN COMMUNITY DEVELOPMENT

1. Based on your research readings, identify and make a narrative report for at least two successful cooperatives in
the Philippines.
- Based in my research about successful cooperative this are two successful cooperatives that I gathered
some information’s:
1. Philippine army finance center producers integrated cooperative (PAFCPI) is a multi-awarded
first billionaire cooperative in the Philippines and its main business is offering financial services
to members through loans and deposit services. It has been in business for 37 years since its
establishment in November 1981. Its membership consists of military and civilian personnel (both
active and retired) of the Philippine Army, Philippine Navy and Philippine Air Force, as well as their
immediate dependents. With its current membership totaling more than 120,000 members, its main
office is located along Bayani Road in Fort Bonifacio, Taguig City and has 25 satellite offices across
the country – 13 in Luzon, 5 in Visayas and 7 in Mindanao. PAFCPIC is the first institution-based
category winner of Gawad para sa Pinakatanging Kooperatiba (Gawad PITAK) of the Land Bank of
the Philippines in 2004. It was the first cooperative recognized for Family Welfare and Community
Development in 2004 and for Labor-Management Relations in 2013 under the Search for Model
Companies by the Department of Trade and Industry (DTI) Center for Industrial Competitiveness. It
was also the first cooperative to have been bestowed the Philippine Quality Challenge Level 2
Award in 2015 by the DTI Competitiveness Bureau in partnership with the Philippine Society for
Quality Inc. Lucio Tan Tycoon Lucio Tan-led Philippine National Bank (PNB) has opened a credit
line of up to P1 billion for the Philippine Army Finance Center Producers Integrated
Cooperative (PAFCPIC). PAFCPIC is currently registered with the Cooperative Development
Authority (CDA) under Registry Number 9520-16000421 dated 16 October 2009.

2. ACDI Multipurpose Cooperative is the largest cooperative in the country with an asset base of nearly 12.29
Billion pesos as of December 2014. In 2015, they are awarded as the Gawad
Parangal Most Outstanding Cooperative Large Scale Category by the Cooperative Development Authority. This
is a statement to the ACDI’s sustainable growth and contributions to people empowerment, social development
and nation building. As of the year 2014, ACDI is operating a total of 80 offices strategically located
across the entire Philippines, a move to make their services closer to and at the convenience of their
members. Their head office is situated at BGen. Felix T. Pestana (Ret) Bldg., with an Annex at Col.
Godofredo M. Juliano Bldg., both in Western Bicutan, Taguig City. ACDI is an institutional cooperative
serving members from the Armed Forces of the Philippines (AFP). Their members are those in active
service, retirees, in the reserved force, and regular civilian employees of the military.
HISTORY OF ACDI MULTIPURPOSE COOPERATIVE The story of ACDI MPC is not summed up by
the amount of assets nor revenues they have made. it can be told by the journey and partnership they
have built with their members and partners to become who they are today. ACDI MPC was able to
grow from a budding credit cooperative in 1981 into the largest multipurpose cooperative in the
Philippines today. This cooperative was born in an era when financial services and assistance
available to the men and women in uniform were controlled by few big players. But even if there were
already a number of established financial institutions service in the military, only few, if not at all, are
owned by soldiers. This is what inspired a group of 26 Philippine Air Force (PAF) pilots, who were all
products of the PAF Flying School, to create the ACES Credit Cooperative Development, Inc. (ACCDI)
on October 20, 1981. With an initial capital of 200,000 pesos, they started the cooperative operation
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 on May 11, 1982 at a small shared office space in Nichols Air Base (now known as Colonel Jesus
Villamor Air Base) in Pasay City. ACCDI was later renamed to ACDI Credit Cooperative in 1991. This
is in compliance with the guidelines on naming cooperatives issued by the CDA. The acronym ACDI
was used to retain the goodwill and reputation the cooperative has established with their members and
partners. In 2002, ACDI became a billionaire cooperative. In 2007, ACDI Credit Cooperative was again
renamed as ACDI Savings and Credit Cooperative as they increase the financial services in savings and
investments. After three decades in operation, they have fully transitioned from a small credit
cooperative into a large multipurpose cooperative and that was happened in year 2011. The
cooperative is offering more product lines, from savings and lending to aviation training, consumer
services, agribusiness and insurance. In 2014, ACDI became the largest cooperative in the Philippines
in terms of assets. Today they were not only able to grow ourselves in size and scale of operations,
but they were able to build the reputation as the most outstanding cooperative in the country as
recognized by the CDA. Jumping off from the gains and achievements in the past decades, ACDI
continues to embark on a much aggressive growth agenda across our various business operations.
These were intended to make their operations more efficient, their products to be more competitive
and the quality of their services to be even much better. ACDI MPC works towards understanding the
uniqueness of their members’ needs. They provide affordable financial and livelihood services to
support members’ development. They provide loans and savings, which form part of the cooperative’s
core business. Low-interest loans were offered as income extenders of members. Loan packages are
being customized to cater to the various needs of the members such as livelihood, real estate, and
calamity loans. Likewise they provide high yielding savings and long term investment packages to
help members prepare for their future. To move closer to its service philosophies, ACDI expanded its
service line from a simple credit services to a more complex services such as aviation training,
consumer services, insurance and agribusiness. ITS COMMITMENTS ACDI
MPC viewed business not as a self serving endeavour but as a social enterprise. It has always been
committed to fulfilling social responsibilities as instruments of advancing growth and development of
members and the communities they live in. As it rise to become one of the leading cooperatives in the
Philippines, social investments continue to reflect to the cooperative’s core philosophies and values.
Its more than 200 social development programs every year are geared to serve the best interest of its
members and to ensure that they live up to become a responsible member of the community of
cooperatives and the Filipino society. Community Development And Nation Building. ACDI works
towards becoming a partner in building empowered and sustainable communities in partnership with
government agencies and NGOs. They initiate and participate in various advocacies and projects,
such as livelihood programs, education and scholarship, medical missions, reforestation, coastal clean
ups, humanitarian assistance and relief drives for those affected by typhoons and other calamities.
Environmental protection. ACDI actively participates in various tree planting and coastal clean up
programs as part of its commitment to the conservation and protection of the environment.
Advancement of cooperativism in the country. ACDI has always believe that in order for the
cooperative movement to flourish in the Philippines, individual cooperatives must grow, and if needed
more cooperative must spring out to reach more Filipinos nationwide. This is why, as part of its
advocacy is to capacitate small and budding cooperatives to be sustainable. It also continues to
create networks of partner cooperatives, under the Convergence Framework of the CDA. ACDI
acknowledges its constraint that they can not effectively address the multi-dimensional needs of all its
members by doing it alone. ACDI continues to strengthen existing partnership by forging new ones
with other cooperatives over areas of cooperative banking, insurance, health management and Coop
Mart. In the coming years, it will continue to push the Convergence Agenda forward to other sectors
such as energy, transportation, media, housing and other areas that will greatly benefit cooperative
members across the country.

2. Discuss some of the reasons and issues why some cooperatives succeed and fail.

- According to my research, some cooperative fails because of some reasons, Overall, co-operatives
have a proven track record of being more sustainable than other forms of business – with over
90% remaining successful after 3-5 years. But, like other business and organizational models, co-
operatives can fail. Often this is the result of common issues faced by businesses, such as market
dynamics, access to capital, or mismanagement. Here are five reasons co-operatives fail:
FAILURE TO INCENTIVIZE SHAREHOLDERS Participation in a co-operative often includes
some investment of time and/or money. Shareholders typically participate in a co-operative
because they see some form of benefit for themselves that comes from their involvement with the
enterprise. These benefits may include a dividend, a patronage refund, access to a new product or
service, greater market certainty, or the ability to get involved in an organization. Failing to provide
tangible incentives, or poorly communicating them, will limit member applications and shareholder
participation. POWER BECOMES CENTRALIZED, When power and authority within a co-
operative begins to centralize around a few individuals like boards or managers, shareholders may
feel disengaged or excluded from a business in which they are an owner. This can lead to
unexpected resolutions and attempts at hostile redirection during annual general meetings.
WRONG PEOPLE IN THE WRONG PLACES Co-operatives, like most businesses and
organizations, rely on people working together towards a common goal to be successful. When
directors or managers view the co-operative business model or co-operation with contempt, their
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 decisions can undermine the co-operative’s ability to function. LACK OF MARKET OR
COMMUNITY SUPPORT Co-operatives work best when the idea and development of the
business is led by the group that will be involved with the co-operative (e.g. the people that will
shop there, work there, or sell products there). This can create a sense of ownership and loyalty
not commonly found in other business models. NOT PLANNING FOR SUCCESSION Co-
operatives, like any other businesses and organizations, need to plan for their future. Leaders and
managers will eventually retire or leave the co-operative, creating a need for someone new to fill
the gap. THE LOWDOWN Co-operatives are most successful when they are built on good
governance, a clear understanding of purpose, and a potential market. A failing co-operative will
show signs early on, and it’s never too late to regroup, rework, and reposition the co-op. But it’s
also important to remember that failing co-operatives do not always need to be saved.

- Cooperatives succeed thru these factors:

- Supportive environment
- Sound advance planning
- Real economic benefits for members
- Skilled management
- Belief in co-op concepts
- Grassroots development and leadership
- Financially self-sustaining
- Innovation and adaptation
- Effective structure and operations
- Networking with other co-ops
- Communications
- Common member interests
- Education

C. GOVERNANCE OF COOPERATIVES

1. Illustrate and explain your ideal cooperative organizational structure.

- A cooperative is a business organizational structure geared toward democratic control and shared decision-
making. There is no single format for structuring a cooperative, because every cooperative business is shaped
to reflect the concerns and passions of its individual members. Regardless of the uniqueness of cooperative
organizations, they share core elements that can be shaped creatively and idiosyncratically.

2. As a person, can you become a good member to a cooperative?

- As a person yes, I will become a good member to a cooperative I will follow the rules and support the goals
and objectives of a cooperative, I will fully understand and do the responsibilities as a member of
cooperative and I will contribute knowledge and invest money to help the cooperative more develop and to
be more successful, I will be a member that have a big contribution in the success of a cooperative.

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 D. COOPERATIVES AND MOJOR ECONOMIC SYSTEM
1. Explain the difference between state socialism with central planning and market socialism.
- State socialism is a political and economic ideology within socialism advocating state ownership of
the means of production, either as a temporary measure in the transition from capitalism to
socialism or as characteristic of socialism itself then central planning is an economy where
decisions on what to produce, how to produce and for whom are taken by the government in a
centrally managed bureaucracy , while market socialism is a type of economic system involving
the public, cooperative or social ownership of the means of production in the framework of
a market economy

2. In what ways can capitalistic and socialistic economies converge?

- One similarity between capitalistic and socialistic is that both systems consider labor and capital to
be the primary economic forces. In this way, both systems are labor-centric. Capitalists believe
market competition should direct the distribution of labor; socialists believe the government should
have that power.

3. Describe the impact and rapidly growing economy can have on families.
- Rapid growth has led to uncontrolled urbanization, which has produced overcrowding, destitution, crime,
pollution, and political turmoil. Rapid growth has outstripped increases in food production,
and population pressure has led to the overuse of arable land and its destruction, the impact of it to the
families are some of their child’s will face some responsibilities at their young age, some of them were not
able to go to school because of financial problem, they rather choose to work and help their parents to earn
money for their living. Rapid growth in a family is not always a good idea specially if they are not living in a
luxury life, their children’s is the one who will suffer the most, instead of going to school they will find a job
some are also engaging in indecent job too. There are also who get married or get pregnant at young age
because they are lack in knowledge and they don’t have the choice but to do it.

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