Workbook in IT 20:

Philippine Industries
and Management

IT-20, Philippine Industries & Management

RAYMUND R. BANIAGA
Dedication

IT-20, Philippine Industries & Management

 Introduction

About this workbook

This workbook has been developed and intended for this subject IT 20 – Philippine
Industries and Management which provides the learner a basic knowledge, concepts, theories,
principles, and methodology for managing a business. This workbook mainly focuses on a
management styles in Philippine setting its type and application that was practice by large and
small businesses. This was extracted from the written books by an expert with various
experiences in management system and design (standards, research and development) that is
simple, clear and practical to college students. This workbook is written primarily for a
student’s – and not for the teachers.

Aside from the terms and questions for review and discussion at the end of every
chapter, a simple and practical questions are presented at the end of a learning outcomes. I
hope and expect that such greater participation of the learners in the learning process will
provide them better understanding about management and apply in their personal and
professional lives in the years to come. I encourage the learner not to rely only on the contents
of this workbook but to read also some other references materials for them to broaden their
knowledge and understanding about managing a business.

I have no claim to the originality of the content of this workbook. My job as a developer
of this workbook is to present the principles and theories of management fundamentals based
from the ideas of the different authors used in this workbook. I believe this is necessary in
helping college students developed their understanding and skills to become competent
managers, service advisor or a leader.

Raymund R. Baniaga

IT-20, Philippine Industries & Management

 CONTENTS

Dedication
Introduction
About the Workbook
Lessons and Activities

Chapter I. Introduction to Management

1. Definition of management and different function based on Philippine setting
2. Types of Management

Chapter II. The Philippine Business Enterprise

1. Business Basic Resources
2. Philippine Business Environment
3. Business Oppurtunities in the Philippines
4. Investment Potential in the Philippines
5. Business Procedure and Incentives

Chapter III. Business Organization

1. Reasons for going into Business
2. Test for Business Success

Chapter IV. Forms or Business Organizations

1. Entrpreneurial Skills
2. Steps in Starting a New Business
3. The Project Study Basic Phase, General Format

Chapter V. Small Business is Possible

1. Characteristics
2. Difference Between Big and Small Business
3. Disadvantagesof Small Buiness
4. Advantages of Small Business
5. Economic Contribution of Small Business
6. Why Small Business Fails

Chapter VI. Industry Analysis/Review

1. Automotive Sectors
2. The Cement Construction Sector
3. The Consumer Sector
4. The Hotel Sector
5. The Mining Sector
6. The Telecommunication Sector
7. The Utility Sector

IT-20, Philippine Industries & Management

Chapter VII. Local Industries
1. Nature of Management
2. Types of Management
3. Concept of Management
4. Levels of Management

Chapter VIII. Managerial Roles

1. Managerial Rules of Management
2. Managerial Rule
3. Management Skills
4. Pinoy Managerial Skills

Chapter IX. Business Plan

1. Background Study
2. Marketing Plan
3. Strategic Plan
4. Financial Study
5. Organizational Structure
6. Operational Plan

IT-20, Philippine Industries & Management

 About the Workbook

The following are the contents of the workbook:

Learning Outcomes. These are the specific learning targets of each

unit based on the topics/lessons presented in the course syllabus of
IT 20 the department based on the competencies reflected in the
COPC of the BSIT program.

Definition of Key Terms. This part unlocks specific words that are
significant in every unit. Definition of these key terms are based on
how they are presented in every lesson for further understanding-
most of them are contextualized.

Concept Building (What You Need to Know). A warm up of the

different lessons based on the specific learning outcomes before the
assessment proper. It contains relevant and up-to-date information
about the lessons tackled in the different units for concept building
which will serve as springboard for the learners for further readings.

Testing Your Brain Power: How Much Have You Learned? A variety
of assessment activities to test the learning outcomes of the learner
in every finished topic. Assessment activities come in many forms-
from objective to subjective assessment modes- to foster further
understanding and appreciation of the lessons.

Developing Your Higher Order Thinking. A higher order, most likely

a combination of cognitive-affective questions, are presented right
after each set of learning tasks to enhance and further boost the
higher order thinking skills of the learner.

Learning Resources. A selection of possible reading materials and a

listing of bibliographic references used in this workbook in various
forms: print media, online retrievals, and film. This will be an added
guide for students in strengthening their understanding of various
concepts presented in the Concept Building (What You Need to
Know).

IT-20, Philippine Industries & Management

 At the end of the lesson, you
are expected to have a higher
level of understanding and
appreciation of the following:

LO 1. Reasons for Going Into Business

LO 2. Test for Business Success.

DEFINITION OF KEY TERMS

Free Person - is one who can decide where to be and what to do at any point in time, without
being answerable to anyone else, not even to a salary.

Entrepreneurship – the activity of setting up a business or businesses, taking on financial risks

in the hope of profit.

Business – as an organization or enterprising entity engaged in commercial, industrial, or

professional activities. Also refers to the organized efforts and activities of
individuals to produce and sell goods and services for profit.

Business Strategy – refers to the actions and decisions that a company takes to reach its
business goals and be competitive in its industry. It defines what the business
needs to do to reach its goals, which can help guide the decision-making process
for hiring and resource allocation.

Sales Strategy – is defined as a documented plan for positioning and selling your product or
service to qualified buyers in a way that differentiates your solution from your
competitors.

IT-20, Philippine Industries & Management

 Concept Building:
What You Need To Know

Lesson 1. Reasons for Going Into Business.

LO 1. Stated the different reasons for going into business.

If you’re thinking about going into business for yourself, you’ve probably heard a
million reasons why you shouldn’t do it. You’ll lose money, you’ll become a workhorse, your
social life will cease to exist, and so on. But, even with these possibilities, people are still
magnetically drawn to entrepreneurship.

The truth is that if everyone actually listened to the naysayers and gave up on pursuing
their dreams, then we wouldn’t have the likes of Bill Gates, Mark Zuckerberg, Larry Page, and
Jeff Bezos, now would we?

Starting a small business is a big step for anyone to take, as it may require leaving the
comfort and security of a regular job for a more uncertain financial future. Small business
success may also require a great deal of planning, enough initial capital to sustain the owner
during the start-up period and possibly a bit of luck. These are a few key reasons why people
make the decision to start a small business.

Successful businesses don't happen overnight. So often we only see the finished
product or hear the story of a successful entrepreneur, we don't hear about the blood, sweat
and tears it took to get them were they are today. It takes a lot of planning to get an idea off
the ground and actually turn it into a profitable business, but it can be done and it can be very
rewarding.

There are many cool reasons why people should get into business. Most people get
into business just to secure some extra income to take care of their many needs. Some even
do so just to raise some money and handle a one-time problem. These are no doubt reasons
why they do business like a part time thing. Such businesses hardly amount to anything big.

Reasons for going into business:

1. To Increase Your Income

This is obviously the main reason why most people get into one form of business or the
other. If you set up a viable business, you are likely to move from a six-digit monthly income
to even an eight-digit income in less than no time.

Business men and women are arguably the richest persons on the globe. They rule this
world with the money they make. From Saudi Arabia to Mexico, Spain to USA, Nigeria to China;
from the Bill Gates of Microsoft to the Larry Ellison of ORACLE to the Ingvar Kamprad of IKEA

IT-20, Philippine Industries & Management

to the Aliko Dangote of Dangote Group and to the Slim Carlos of Telecom, etc, it is evident that
business men and women rule this world.

These days there are few jobs that can pay a person enough money to take care of the
needs of a family. A sure way to get a comfortable life and earn serious income is to get into
your own business. Hardly will you find a very rich person who is depending fully on a job.

If you are unsatisfied with the income you make every month, you need to seriously
consider starting up a business. You will soon have more than enough money resting in your
bank account.

2. To Have An Additional Job

It is very difficult to handle two jobs at the same time. But having a formal job and
doing a business is not too difficult. In fact today, many people do both. They set up a business,
employ one or two persons to work for them and then still carry on with their formal job. Such
an opportunity only comes when you set up your own business where you make the decisions.

As you grow in life, you will soon see that your job is unable to fund the projects of
your life. When this happens, starting up a business of your own is the best option you have.

3. To Be Your Own Boss

Not many people love to be bossed and controlled around. People love to do things
out of their discretion. Sometimes when I see an old man in his 60s and 70s, answering “Sir”
and being ordered around by a young man in his 20s – 40s who happens to be his boss, I can’t
help but pity the situation. This happens only to people who are solely dependent on their jobs
for survival.

When you set up your own business, you have no one to answer to but you. You can
make decisions freely and choose what to do at every point in time, without anyone asking
you questions. You are the boss and everyone respects you for that.

4. To Get Freedom

Man naturally loves some degree of freedom. Because you don’t have chains on your
hands, doesn’t mean you are free. As long as you have to strive daily to be at work in order to
secure an income, you are not free. Even if you are heading the organization you work for, you
are not free as long as you can only earn an income if you go to work.

A free person is one who can decide where to be and what to do at any point in time,
without being answerable to anyone else, not even to a salary. I am sure you will love such a
life. Starting your own business will allow you have full control over your life and you could
spend every day of your life traveling all over the world, getting recognition, reaching out to
needy people, making your impact felt and enjoying all the good things money can offer, while
others work for you.

IT-20, Philippine Industries & Management

5. To Gain Job Security

Before now, most people thought that in order to secure a wonderful future, you ought to
study, get a good degree, pick up a lucrative job and earn a huge package. Now, with the high
rate of job insecurity, getting a job has become the most insecure way to earn an income. This
is worst in the private sector.

I was talking lately with a friend who works with a private mining company and she told
me that the industry is a very lucrative one with well-paid jobs but the most insecure place to
be. She said when you work in her company, at the end of each month you pray hard not to
receive a letter saying that you have been laid off. It is that bad.

Owning your own business offers you a very high level of job security when well
established. The decisions to quit or stay both lie in your hands and no one else’s. No day will
you wake in the morning to receive a sack letter.

6. To Enjoy Life By Doing What You Love

There are very few jobs that offer one the opportunity to do what he loves. I have found
out that one of the reasons why the rate of deaths from stress, fatigue, high blood pressure,
heart failures, are now increasing daily is because many people either do stressful jobs or jobs
they hate.

Starting up your own business offers you the rare opportunity to do what you love and
create your own unique impression in the world. When you do what you love, you earn money
for doing nothing. Writing is something I love to do. I am very relaxed when I write. If I build a
business that is centered on writing and publishing, life is more likely to be fun for me.

7. To Meet A Need In The Market

Every good business identifies a need in the market and seeks to meet it. Needs abound
everywhere around us. There will never be a time when all the needs we have would have
been met. Starting up your own business begins from discovering a gap (or need) and seeking
to fill it up. It is always so wonderful when someone comes up with something that addresses
the problems of people and succeeds. The feeling is an out-of-this-world feeling.

The only way to meet a clear need in the market is to step out of the comfort zone of
a job and go through the odds just to fill an existing gab. You can only do this by starting up
your own business.

8. To Develop Your Own Creative Skills

Starting your own business is one big way of putting your creativity to work and thus
developing it. When you know that your life depends on how much you make use of you
knowledge, talents, skills, experience, etc, you cannot go to sleep. You are always thinking and
trying to come up with something that will keep your business going forward. This will make
you even more creative.

IT-20, Philippine Industries & Management

 Most jobs are built around some form of routine and only help to kill the creativity in
most people. This is why a true entrepreneur is hardly able to keep a job.

9. To Have Influence

Did you know that the business people of every nation have one of the greatest
influences on who is who in the leadership of that nation? They appear not to be interested
but many of them have a greater influence on the political climate of the nation than the ballot
box. They sponsor candidates during elections, sponsor bills in parliament, influence
presidential appointments, and so on. They have an indirect influence over your life and what
becomes of you.

When you grow your business to a height that you no longer make money for yourself
alone but your money starts affecting people’s lives, you have started having influence. Such
money can easily be guaranteed by building a business of your own.

10. To Enjoy Recognition

One of the most accomplished business men in my country that I know of, did not go
to school to beyond the primary level. He cannot even speak English properly. However,
wherever he goes, people respect him. No one cares if he is educated or not. He is more
recognized than many professors and accomplished career men in the country.

His businesses are all over the country and through them he has put food on many
tables by offering numerous job opportunities for people. He travels abroad very frequently
and whenever decisions are made that concern any sector where he has invested, he is
consulted and his opinion is sought after. He has vocal power; He has a voice all because he
went into business.

You will hardly be able to gain some great level of recognition if all you do is leave the
house daily to an office and back. At most, it will be in your organization and if it goes beyond
that, it will be short-lived.

IT-20, Philippine Industries & Management

 Testing Your Brain Power:
How Much Have You Learned

Identification: Read the following statements and write your answer on the space
provided.

1. A packaged business investment that allows the buyer to

begin a business
2. A system of production, resource allocation and distribution
of goods and services within a society or a given geographic
area.
3. An advantage such as medical insurance, life insurance, and
sick pay that employees receive from their employer.
4. Important to the organization and create a value proposition
in service to its costumer.
5. The most important element in starting a business.
6. Success of an organization is heavily reliant on the talent and
strength of its _____________.
7. Greatest thing an entrepreneur can do when establishing new
business.
8. One of the costliest aspects of business planning.
9. One of the oldest and simplest form of business organization.
10. An association of two or more persons who are co-owners of
a business.
11. A market situation where there is a large number of
independent sellers offering identical products.
12. Refers to a market situation where there is only one producer.
13. Market situation where there is a large number of small
producers selling similar but bot identical products.
14. Factors of production and distribution are owned and
managed by the state.
15. A reward offered for increased productivity.

IT-20, Philippine Industries & Management

 Developing Your Higher Order Thinking

What are the different reasons that you should know before going into business?

Why is important to know the reasons of going into business?

When you’re on your own, you feel a

sense of satisfaction when you
accomplish something. If you don’t
meet your quarterly earnings goal at
your small business, it falls on you.

IT-20, Philippine Industries & Management

 Concept Building:
What You Need To Know

Lesson 2. Test for Business Success

LO 2. Gave the different test for business success.

First of all, in entrepreneur coaching, coaches, advisors, and teachers can’t rely on their
gut feeling alone. They need personality assessments and tools to assess and develop
entrepreneurs and their businesses. Not only for potential entrepreneurs who are thinking
about starting a new business, but also business leaders who can turn an idea into
entrepreneurial success.

A common concern among prospective entrepreneurs is whether they have the right
personalities, characteristics or skills necessary to own and run a small business. The good
news is that there’s no definitive formula for what makes a person well-suited to being an
entrepreneur. Still, it is true that most successful entrepreneurs share certain characteristics.

Testing a business idea is crucial to its success. If you blindly assume an idea will be a
big hit, you're risking a great deal of time, money and other resources invested in its launch.
Businesses often skip this step because they're in a rush to launch their product. They don't
create a business plan or business model based on their market testing/research, pursuing
their business journey without a road map. Additionally, they fail to identify exactly who their
target audience is. Until you test your idea, you won't know who will find it useful. Without
this information, your marketing could fall on deaf ears, getting you nowhere with your
product idea — even if it's a great one.

Test for Business Success

1. About you

✓ Why do you want to put up your own business?

✓ Do you have experience in the business you like to start?
✓ Have you worked as a manager before?
✓ Do you have a business training or education?
✓ Do you have capital for your business?

2. About capital

✓ Do you know how much money you need for your business?
✓ Do you know how much credit you can et from your suppliers?
✓ Do you know where to borrow, in case your funds are not enough?
✓ Do you have an estimate of your net income per year?

IT-20, Philippine Industries & Management

 3. About partner

✓ Do you need a partner who has the money and skills?

✓ Do you know the advantages and disadvantages in choosing single proprietorship,
partnership, or corporation as your business organization?
✓ Have you consulted an expert?

4. About your costumer

✓ Who are your costumer?

✓ Do people need your business?
✓ Do people like to live in the place where you intend to put up your business?

5. About your qualities

✓ Are you a self starter?

✓ How do you feel about other people?
✓ Can you lead others?
✓ Can you make decisions?
✓ Can you take responsibilities?
✓ Are you good in planning and organizing?
✓ Can people trust what you say?
✓ Are you hardworking?
✓ Is your health good?

Here are some steps to testing your business idea that could help you start your business.

1. Build a prototype or test service.

Although you're excited about your new business idea, you might want to wait a while
before testing it, said Greg Isenberg, a venture capitalist and serial entrepreneur. "After I've
gone through the process of writing down a bunch of ideas, I don't like to rush into building a
business plan or recruiting the team," Isenberg said. "I like to wait a few weeks, [to] see which
ideas really stick with me."

Isenberg said he only moves forward if he has a burning feeling that the world
genuinely needs his idea.

"Once I'm through that, the best way to test a business idea is to build some prototype
and show it to people to get some honest and authentic feedback," he said. [Looking for a
business idea? Visit our Business Ideas page.]

2. Build a minimum viable product.

Following the lean startup model is a great way to develop your business or a specific
product. Most importantly, you want to build a minimum viable product (MVP).

IT-20, Philippine Industries & Management

 An MVP is "the simplest form of your idea that you can actually sell as a product," said
Eric Ries, a Silicon Valley-based entrepreneur and the author of The Lean Startup (Crown
Business, 2011). Using the principles of Lean Six Sigma, Ries' book advocates having a version
of the product to test and market early in the development process so that any tweaks or
changes are in response to real feedback from the target audience.

3. Run it by a group of critics.

When you have your first prototype or test service ready, present it to potential target
customers.

"You should talk [to] and/or survey at least 50 potential customers, to see if they identify with
the problem the same way you do," said Wayde Gilchrist, a startup consultant and host at
TechStartRadio.com. "In other words, you need to find out if this is a real problem for a
majority of your target market, or just a few."

However, to truly put your new business idea to the test, select your 50 potential
customers or clients carefully.

"Identify people in that target you know to be skeptical and critical," said Chip Bell,
founder of the business consultancy firm The Chip Bell Group. "These people could be irate
customers from previous encounters or friends who always take the glass-half-empty
perspective."

Bell advised hand-picking your test group and then asking these people to pick your
ideas apart.

4. Tweak it to suit your test market.

Isenberg took a similar approach to testing 5by, an Internet video finder app he
developed and has since sold. Isenberg and his team went to college campuses and showed
mock-ups of what the product was going to look like. They found the feedback from students
invaluable in fine-tuning the original idea.

"We were able to quickly gauge that people ... were frustrated that they couldn't open
an app and just be able to find the best internet videos in whatever they were interested in
with just a tap of a button," he said.

Isenberg realized that although his initial business idea and mock-up were a good start,
they needed tweaking.

"We quickly knew we were onto something and then focused on building out the
product, raising money, etc.," he said.

5. Create a test website with social media tie-ins.

Once the word is out about your product or business, the target market needs a place
to get more information about it or to show it to their friends. Building a simple website with

IT-20, Philippine Industries & Management

a landing page specifically for the product and using social media are great ways to provide
information and monitor how many people are interested in what you are selling.

"You'll be able to tell if the idea will get traction from the number of click-throughs on
the ads, and the number of people who fill in your form," Gilchrist said.

6. Create a marketing plan and use it.

All of the preparatory work means nothing if you do not perform enough actions to get
a good measure of response. Once you have a viable product, you need to act on the interest
in it, said Ryan Clements, a consultant to entrepreneurs on marketing and sales strategy.

"Having worked with many startups — both on my own account as an entrepreneur

and as an advisor to others — I like to use a rule I call 100/1,000," Clements wrote in a blog
post on IvyExec. "Make a list of 100 things you can do to market the product, and then execute
that list of 100, and in the process, speak with 1,000 people about the product."

If you do this, you will have data on your product, Clements said. You'll know who is
interested in it, what marketing strategies worked and didn't work, and how you can improve,
all of which are invaluable steps in getting your idea and business off the ground, he added.

7. Adopt an experimentation mindset.

Too many businesses are afraid to fail, so they don't put themselves in the position to
do so. Often, this looks like either avoidance of pursuing new ideas or failure to properly test
a product idea before launching it.

By adopting an experimentation mindset, you'll be more willing to make mistakes and

test a variety of different ideas. Your business model will unlock more long-term value, as you'll
give more ideas a chance to come to fruition. In this case, failure is also seen as a success, as
it allows you to better understand what works and what doesn't in this everchanging business
world.

8. Implement design thinking.

Design thinking involves the cognitive, strategic and practical processes of developing
new ideas or products. It helps innovators redefine problems and create better, more creative
solutions. In other words, it opens the door to more groundbreaking discoveries and
inventions.

To implement this strategy into your business, you want to follow the five stages of
design thinking: empathy (research/understand customers' needs), define (state your
customers' problems and needs), ideate (brainstorm unique solutions to their problems),
prototype (create the solutions) and, most importantly, test (try them out yourself).

IT-20, Philippine Industries & Management

 Testing Your Brain Power:
How Much Have You Learned

Identification: Read the following statements and write your answer on the space
provided.

1. Refers to the factors that affect the efficiency of a business

enterprise.
2. It supervises the operations of the banking institution.
3. Supervise and regulates the activities of business enterprise in
the interest of economy and society.
4. Regulates the activities of private hospitals to protect the
welfare of their patient.
5. Activity of DOLE that supervise the safety of the workers in the
workplace and work environment.
6. Directly engaged in business through government business
corporations.
7. Refer to interest rate, legal reserve requirements, open-
market operations.
8. A frequent change in government officials is not conducive to
the efficient operations of business enterprise.
9. (True/False) Politics has to interfere in business activities to
protect the consumers and other sectors of the society.
10. (True/False) Government has the least interference in
business affairs under communism.
11. (True/False) During inflation costs of production are high,
market prices of goods and services are also high.
12. (True/False) Presence of rebels, kidnappers and other types of
criminals drive away investment.
13. Facilities that are vital to the efficient operations of business.
14. (True/false) To protect the welfare of the consumers, the
government has to monitor the activities of business firm.
15. (True/False) Government participation in business activities is
in the form of assistance and control.

IT-20, Philippine Industries & Management

 Developing Your Higher Order Thinking

What are the different test to take before going into business!

Why is important to take a test before going into business?

Testing your business idea is a

necessary preliminary step to identify
your target market and refine your
business idea with their real-world
needs.

IT-20, Philippine Industries & Management

 Learning Resources

Fajardo, Feliciano R. (1997) Management, Rex Book Store, Inc.

Franco, Ernesto A. (1986), Pinoy Management. National Book Store Inc.,

Tan Tek Meng et al. (1996), Business Opportunities in the Philippines. Singapore: Nanyang Business
School, Prentice Hall,

Zulueta F. et al. (1999) Management: theories and Practice. Mandaluyong City: Academic Publishing
Corp.,

https://www.myjobmag.com/square/article/104/reasons-why-you-should-get-into-business

https://www.forbes.com/sites/gingerdean/2016/05/29/7-reasons-to-go-into-business-for-
yourself/#5dd50e2d22f9

https://catchfirefunding.com/11-reasons-to-go-into-business-for-yourself/

https://www.wesst.org/business-resources/entrepreneur-quiz/

https://entrepreneurscan.com/

https://www.businessnewsdaily.com/6540-how-to-test-your-business-idea.html

IT-20, Philippine Industries & Management