Republic of the Philippines

Department of Education
Region I
SCHOOLS DIVISION OF ILOCOS NORTE

ORGANIZATION
AND MANAGEMENT
Quarter II - Module 8:
Functional Areas
of Management

MELC: Explain the nature and role in the firm of the

following functional areas of management: a. Human
Resource Management; b. Marketing Management;
c. Operations Management; d. Financial
Management; e. Material and Procurement
Management; f. Office Management; g. Information
& Communication Technology Management
(ABM_AOM11-IIi-39)

Prepared by:

JEFFERSON V. BALOALOA
SHS Teacher I
Lanao National High School
Organization and Management - Grade 11
Alternative Delivery Mode
Quarter 2 – Module 8: Functional Areas of Management
First Edition, 2020

Republic Act 8293, section 176 states that: No copyright shall

subsist in any work of the Government of the Philippines. However, prior
approval of the government agency or office wherein the work is created shall
be necessary for exploitation of such work for profit. Such agency or office
may, among other things, impose as a condition the payment of royalties.

Borrowed materials (i.e., songs, stories, poems, pictures, photos, brand

names, trademarks, etc.) included in this module are owned by their
respective copyright holders. Every effort has been exerted to locate and seek
permission to use these materials from their respective copyright owners. The
publisher and authors do not represent nor claim ownership over them.

Published by the Department of Education

Secretary: Leonor Magtolis Briones
Undersecretary: Diosdado M. San Antonio

Development Team of the Module

Author: Jefferson V. Baloaloa
Editors:
Reviewer:
Layout Artist/ Illustrator:
Management Team:
Joann A. Corpuz

Joye D. Madalipay

Santiago L. Baoec

Jenetrix T. Tumaneng

Name of EPS In Charge: Archie Mateo Llaguno

Name of PSDS In Charge

Printed in the Philippines by: _____________________________________________

Schools Division of Ilocos Norte

Office Address: Brgy. 7B, Giron Street, Laoag City, Ilocos Norte
Telefax: (077) 771-0960
E-mail Address: ilocos.norte@deped.gov.ph
 11

ORGANIZATION
AND MANAGEMENT
Quarter II – Module 8:
Functional Areas
of Management

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Introductory Message
For the facilitator:

Welcome to the Organization and Management 11 Alternative Delivery Mode

(ADM) Module on Functional Areas of Management!

This module was collaboratively designed, developed and reviewed by

educators both from public and private institutions to assist you, the teacher or
facilitator in helping the learners meet the standards set by the K to 12 Curriculum
while overcoming their personal, social, and economic constraints in schooling.

This learning resource hopes to engage the learners into guided and
independent learning activities at their own pace and time. Furthermore, this also
aims to help learners acquire the needed 21st century skills while taking into
consideration their needs and circumstances.

In addition to the material in the main text, you will also see this box in the
body of the module:

Note to the Teacher

This contains helpful tips or strategies that
will help you in guiding the learners.

As a facilitator, you are expected to orient the learners on how to use this
module. You also need to keep track of the learners' progress while allowing them to
manage their own learning. Furthermore, you are expected to encourage and assist
the learners as they do the tasks included in the module.

For the learner:

Welcome to the Organization and Management Alternative Delivery Mode

(ADM) Module on Functional Areas of Management!

The hand is one of the most symbolized parts of the human body. It is often
used to depict skill, action and purpose. Through our hands we may learn, create
and accomplish. Hence, the hand in this learning resource signifies that you as a
learner is capable and empowered to successfully achieve the relevant competencies
and skills at your own pace and time. Your academic success lies in your own hands!

This module was designed to provide you with fun and meaningful
opportunities for guided and independent learning at your own pace and time. You
will be enabled to process the contents of the learning resource while being an active
learner.

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This module has the following parts with their corresponding icons:

What I Need to Know This will give you an idea of the skills or
competencies you are expected to learn in the
module.

What I Know This part includes an activity that aims to

check what you already know about the
lesson to take. If you get all the answers
correctly, you may decide to skip this module.

What’s In This is a brief drill or review to help you link

the current lesson with the previous one.

What’s New In this portion, the new lesson will be

introduced to you in various ways such as a
story, a song, a poem, a problem opener, an
activity or a situation.

What is It This section provides a brief discussion of the

lesson. This aims to help you discover and
understand new concepts and skills.

What’s More This comprises activities for independent

practice to strengthen your understanding
and skills of the topic. You may check the
answers in the exercises using the Answer
Key at the end of the module.

What I Have Learned This includes questions or open-ended

statements to be filled in to process what you
learned from the lesson.

What I Can Do This section provides an activity which will

help you transfer your new knowledge or skill
into real life situations.

Assessment This is a task which aims to evaluate your

level of mastery in achieving the learning
competency.

Additional Activities In this portion, another activity will be given

to you to enrich your knowledge or skill of the
lesson learned. This also develops retention
of learned concepts.

Answer Key This contains answers to all activities in the

module.

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At the end of this module you will also find:

References This is a list of all sources used in developing

this module.

The following are some reminders in using this module:

1) Use the module with care. Do not put unnecessary mark/s on any part of the
module. Use a separate sheet of paper in answering the exercises.
2) Don’t forget to answer What I Know before moving on to the other activities
included in the module.
3) Read the instruction carefully before doing each task.
4) Observe honesty and integrity in doing the tasks and checking your answers.
5) Finish the task at hand before proceeding to the next.
6) Return this module to your teacher/facilitator once you are through with it.
If you encounter any difficulty in answering the tasks in this module, do not
hesitate to consult your teacher or facilitator. Always bear in mind that you are
not alone.
We hope that through this material, you will experience meaningful learning
and gain deep understanding of the relevant competencies. You can do it!

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 What I Need to Know

This module was designed and written with you in mind. It was
specifically developed and designed to provide you fun and meaningful
learning experience, with your own time and pace. This module shall serve to
give you a more in-depth knowledge about the different functional areas of
management and the important terms that may be associated with it. The
scope of this module permits it to be used in many different learning
situations. The lessons are arranged to follow the standard sequence of the
course.

This module contains only one lesson, entitled:

• Lesson 1 – Functional Areas of Management

After going through this module, you are expected to:

• Explain the nature and role in the firm of the following functional areas
of management: a. Human Resource Management; b. Marketing
Management; c. Operations Management; d. Financial Management; e.
Material and Procurement Management; f. Office Management; g.
Information & Communication Technology Management
(ABM_AOM11-IIi-39)

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 Lesson
Functional Areas
1 of Management

What’s In

To prepare you to become future leaders and managers, you must

become familiar with the functional areas of management – Human Resource
Management, Marketing Management, Operations Management, Financial
Management, and Information and Communication Technology Management.
In doing so, you will be ready for the local and global challenges that you will
inevitably meet in tomorrow’s workplace. Managerial and leadership functions
are essentially the same because all these aims to establish an environment
for the effective and efficient performance of individuals and cooperate with
one another in teams/groups of different organizations. Therefore, reading
and understanding this module will be beneficial to all persons who will one
day join organizations – not just business companies but also nonbusiness
organizations such as government, education and health care institutions,
and other nonprofit organizations.

What’s New

Human Resource Management (HRM)

Human resources, also known as human capital, drive the performance

of organizations along with other resources; hence, understanding the HRM
functions of management is very important. Human resource management
is the process of attracting, training, and maintaining an excellent work force.
These include:

• Conducting job analysis. Job analysis is the process of obtaining

information about jobs needed to achieve the organization’s
goals/objectives by determining the duties, tasks, or activities involved

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 in jobs. Decision-making regarding job-related problems is done
objectively by analyzing the requirements of each job.

• Planning labor need and recruiting. It is important to determine the

number and kind of people that may be attracted for employment.
Recruitment from within the company is said to be less expensive and
existing employees no longer need extensive orientation programs.

• Selecting candidates for the job. This involves the matching of people
and jobs. Job specifications help identify the person-job fit and identify
their individual competencies, their knowledge, skills, abilities and
other factors that may lead to excellent performance.

• Orienting and training new employees. This is done in organizations

so that they could contribute to the achievement of their organizational
goals/objectives.

• Managing compensation or pay. Compensation or pay represents a

reward received by employees in exchange for their contributions to the
achievement of organizational goals. It must be fair and just, acceptable
to all concerned parties, and commensurate to the value of the work
performed.

• Providing incentives and benefits. Incentives are generally based

upon a pay-for-performance philosophy which means that a
performance “threshold” or a baseline performance level must be
reached by an employee or group of employees in order to qualify for
incentive payments. Benefits, on the other hand, include social
security, workers’ compensation, health care and medical and
educational assistance, vacation leave, sick leave, life insurance,
retirement benefits, and travel benefits. It is important that incentives
and benefits programs be based on specific objectives compatible with
the organizational philosophy and policies and the organization’s
financial standing.

• Evaluating employees’ performance. Appraisal of employees is done

on regular basis to find out who are doing their jobs well and who are
not. The purpose of such evaluations is administrative and
developmental which were discussed on the previous modules.

• Communicating. To be effective, managers must have good

communication skills, both oral and written and information
technology proficiently. This is necessary to receive and disseminate
information needed by all organization members in carrying out
activities. Besides, carrying out internal communication, managers
must also have good communication with customers, suppliers, and
other stakeholders in the external environment.

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 • Developing employees. Programs should be designed to meet the
special needs of employees which will prepare them for the future jobs
or roles that they may be assigned to do. These may include: graduate
studies, cross-training, which refers to the process of developing
employees to do multiple jobs or ethic training, the process of
developing employees’ moral judgments that will help them determine
right and wrong behavior.

• Building employee commitment. This is another important function

of HR practitioners which will bind them to engage in activities that will
ensure achievement of the organizational goals/objectives.

• Providing good working conditions. This includes giving a velar

statement of the company’s mission, vision, goals, and objectives;
offering a good compensation and benefits package; preparing a well-
ventilated, well-lit, and pollution-free work area for employees; and
practicing ethical management styles.

• Handling grievances and industrial relations. When differences arise

between labor unions and management, these are usually settled
through the grievance procedure, wherein the feelings, needs, and
desires of both parties are aired. Managers must try to master the art
of handling grievances and industrial relations to bring peace in their
organization.

Importance of Human Resource Management

Human Resources Management deals with the management of people

– the most important business resource. Money, materials, and information
resources are not capable of moving the business activities without the aid of
the primary performance drivers, human resources. Therefore, mastering the
activities involved in human resources management (recruitment, selection,
placement, training, and development) is a must since all other management
activities (planning, organizing, staffing, leading, and controlling) could be
done easily if organization managers practice proper human resources
management.

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 What is It

Marketing Management

As marketing expert Philip Kotler puts it, marketing management is

essentially demand management. This is because it involves influencing the
level, timing, and composition of demand so that an organization may reach
its goals.

As defined by the American Marketing Association, marketing

management is the process of managerial planning and carrying out the
conception, pricing, promotion, and distribution of ideas, goods, and services
in order to bring about exchanges to satisfy individual and organizational
goals.

The marketing management functions of management include the

following:

• Analyzing, planning, implementing, and controlling of goods, services,

and ideas to create exchanges that satisfy customers needs and
company goals.
• Management of marketing resources which includes sales people,
advertising, and marketing research.
• Analyze, plan, and implement marketing programs that aim to bring
about expected level and mix of business deals with target markets.
• Stimulate demands for the products of the company.
• Make crucial decisions that will ensure the company’s competitiveness.
• Make sure that marketing techniques employed are efficient, effective,
and socially responsible or ethical.

Importance of Marketing Management

Marketing management is important because it is the key to

organizational goal attainment, customer satisfaction, and profit gain.
Without major marketing management processes – planning, execution,
pricing, and promotion and distribution of goods, services, and ideas to create
exchanges with target groups – satisfying customers and achieving
organizational goals will not be possible.

Operations Management

Operations management is the study of how goods and services are

produced in organizations. Business managers today focus on productivity,

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technology use, quality of goods and services, customer satisfaction, and
speed. They are conscious that they need to innovate on their processes and
activities in order to succeed in a highly competitive globalized market.
Because of these needs, the operations management functions of
management must include the following:

• Overseeing the transformation processes that change resources into

finished goods and services.
• Improvement of productivity (productivity = output ÷ input) and
competitive advantage.
• Managing sequence of activities and information along the whole course
of the value chain.

Importance of Operations Management

Through the study of the essentials of operations management,
businesses of different types and sizes may increase their chances for survival
and success in today’s business environment which is characterized as highly
competitive and fast-paced in producing quality products and services.

What’s More

Financial Management

Gaining profit is the main goal of businesses. To attain this goal,

managers must practice good financial management and this, of course,
starts with understanding the financial management functions of
management. Financial management is the management and custody of the
organization’s funds, seeing to it that funds are effectively and efficiently
utilized of the organization’s various operating units.

These functions include:

• Taking charge of the company’s financial policies and strategies,

investments, capital structures, and dividend policies. Financial
managers must formulate sound financial standing plans that will
communicate broad guidelines for their financial decisions and
strategies.

• Financial management and control. The management and custody of

the organization’s funds also include control which gives an assurance
that funds are properly utilized in order to provide for all the
organization’s needs.

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 • Financial planning. Financial planning is the process of setting
financial objectives and determining what should be done to accomplish
them. This includes financial forecasting, financial analysis, and
financial performance evaluation.

Importance of Financial Management

Financial management facilitates the choice of investments, financial

policies, and operating mechanism of the organization in order to effectively
achieve its goals and objectives. To accomplish the abovementioned functions
that give importance to financial management in organizations, control
techniques, that measure the company’s financial soundness, management
effectiveness, production and service efficiency, and human resource
attitudes and morale must also be considered. These include the following:

• Break-even chart – is used by organization’s financial management

planners and accountant to identify how the various sales levels affect
the income and profits of the firm. The break-even point is the level of
operations which shows equal income and expenses incurred by the
company.

• Financial statements – include income statements, balance sheets, and

cash flow statements which are carefully analyzed.

• Financial ratios – make use of the above-mentioned financial

statements to determine the formulation of a series of ratios that will
determine if the company is stable or unstable, strong or weak or on
the road to bankruptcy.

Another functional statement used in financial management that also

emphasizes its importance is the organization’s budget. This state the amount
of money that the company will spend and receive during a future period of
time.

Information and Communication Technology Management (ICTM)

Information and Communication Technology Management (ICTM)
is the management of information and communication technology that
collects, organizes, and distributes data to be used in the organization’s
decision-making functions.
The ICTM functions of management include the following:

• Developing the organization’s hardware, software, and other

computing and communicating technology. The fast and ever-
changing nature of ICT requires managers to become flexible and open
to change.

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 • Developing the organization’s management information system
(MIS) tailored to the needs of the firm’s units. IT has developed
management information systems which gather, process, and
disseminate internal and external information to the company on a
timely basis order to support managers in their tasks.

• Encouraging e-commerce through Internet use. Through e-business

strategies, the company gains competitive advantage over competitors.
Common e-business strategies involve business to business (B2B) and
business to customer (B2C) transactions.

What I have learned

Direction: Answer the following questions briefly. Write your answers in a

sheet of paper.

1. Is communication important in human resources management?

Explain your answer.
2. Is marketing practiced by profit organizations only? Explain your
answer.
3. Give the relationship between financial management to the managerial
function of controlling. Explain your answer.
4. How important is ICTM in today’s business world?

What I can do

Direction: Perform the task below. Do it in a sheet of paper.

1. Interview two teachers or any professionals regarding their perceived

advantages and disadvantages of ICT. Compare their answer with your
own perceptions. Do you agree with them? Explain your answer.
2. Search the internet for the term “return on investment’. Is this term
related to financial management? Explain.
3. A small notebook manufacturing company produces 500 notebooks per
week; with only two full-time workers as input measure. Compute the
company’s productivity. A bigger company with three full-time workers
produces 600 notebooks per week. Which is more productive, the small

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 notebook manufacturer or the big notebook manufacturer? Explain
your answer.
4. Interview someone you know who is employed and find out the types of
benefits provided to him/her. Akh him/her if he/she is satisfied with
the benefits and if these influence his or her work performance.

Assessment

Direction: Read and understand the following statement below and identify
what is being describe. Write you answer in a sheet of paper.

1. B2B is a common e-business strategy which means __________________.

2. The amount of money that a company will spend and receive during a
future period of time.
3. The study of how goods and services are produced in organizations.
4. It is the process of setting financial objectives and determining what
should be done.
5. Income statement, balance sheet and cash flow statements are
examples of __________________.
6. The most important busines resource is ______________.
7. Health care, medical and educational assistance, vacation leave, and
sick leave are examples of _______________.
8. The process of obtaining information about jobs is called
______________.
9. The ultimate goal of business is to _______________.
10. The process of planning and carrying out the conception ideas in order
to bring about exchanges to satisfy individual goals.

Additional Activities

Directions: Perform the task below. Do it in a sheet of paper.

Choose two competing products. Study the two products’ advantages

and disadvantages in attracting customer interest. Which company will have
competitive advantage, Product A or Product B? Explain you answer.

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 Answer Key

What I have Learned

This vary. A point will be given for every correct answer.

What I Can Do

This vary. A point will be given for every correct answer.

Assessment

1. Business-to-business
2. Budget
3. Operations management
4. Financial planning
5. Financial statements
6. People/Human resource
7. Benefits
8. Job analysis
9. Gain profit
10. Marketing management

Additional Activities

This vary. A point will be given for every correct answer.

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References:
Books

1. Cabrera, Helena M. F., Altarejos, A. & Benjamin, R. (2016).

Organization and Management. Quezon City, Philippines: Vibal Group,
Inc.

Other Sources:
1. K to 12 Senior High School ABM Specialized Subject – Organization and
Management December 2013
2. K to 12 Curriculum Implementation and Learning Management Matrix
3. Salvador, E. (2020). Module in Organization and Management.
Alternative Delivery Mode.

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For inquiries or feedback, please write or call:

Schools Division of Ilocos Norte – Curriculum Implementation Division

Learning Resource Management Section (SDOIN-CID LRMS)

Office Address: Brgy. 7B, Giron Street, Laoag City, Ilocos Norte
Telefax: (077) 771-0960
Telephone No.: (077) 770-5963, (077) 600-2605
E-mail Address: ilocos.norte@deped.gov.ph

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