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Abm - Org Man W8
Abm - Org Man W8
Abm - Org Man W8
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ABM - Organization and Management
Grade 11 Module 8: Quarter 1, Week 8
First Edition, 2020
Copyright © 2020
La Union Schools Division
Region I
All rights reserved. No part of this module may be reproduced in any form without
written permission from the copyright owners.
Management Team:
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Organization and
Management
Module 8: Quarter 1 - Week 8
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Target
In your previous lesson, you learned about the nature of planning and the
importance of planning concepts as well as the application of tools and techniques to have
a good and wise decision making in business success.
This learning material will provide you with information that will help you
understand the Nature of Organizations and Types of Organization Structure.
After going through this learning material, you are expected to:
Before going on, check how much you know about this topic. Answer
the following pretest in a separate sheet of paper.
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Jumpstart
Directions: Read and understand the description and characteristics of the three
(3) options in forming a business. Concentrate on what you are reading.
There are a lot of questions and concerns that crossed his mind while
thinking of his expansion plans: shall he remain as a single proprietor-owner or extend
the ownership by asking some of his trusted relatives and friends? In putting up also
a new branch, Mr. Pedro needs more capital to buy the necessary things for his second
pharmacy. He has to improve his credit standing and to prepare enough of his
present assets to guarantee him in getting a loan from a bank or he needs also some
investors. What’s the best approach in organizing his business? He began to have his
initial research and it resulted to these three options:
(a) Single Proprietor / Owner, a single person that holds the entire operation
as his personal property, managing it on a day-to-day basis.
(b) Partnership, a single business with two or more people sharing its
ownership. Each partner contributes to all aspects of the business,
including money, property, labor or skill. Each partner shares in the profits
and losses of the business.
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(c) Corporation, a form of business that keeps the dealings, assets, and bank
accounts separate from his/her personal assets.
Directions: Read and analyze the following questions. Choose the letter of your
answer from the given choices. Place your answer in a separate sheet of paper.
1. Which of the following is a single business with two or more persons sharing its
ownership where each partner shares in the profits and losses of the business?
A. Sole Proprietor C. Corporation
B. Partnership D. Organization
A. Management C. Organization
B. Nature D. Structure
4. Among the choices below, who is responsible for ensuring the procurement process
and the supply base effectively and efficiently?
A. Human Resource Management C. Office Management
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Activity 2: Look at me!
Directions: Read and understand the description and characteristics of the different
types of organizational structure. Concentrate on what you are reading.
Miss Lydia will have a job interview tomorrow in JADG Company. Due to
excitement, she arrived early. As she entered the building, she noticed a bulletin board
with different postings.
While waiting for her call, she roamed the place to take a quick look, and there
she went to the bulletin board and read some announcement, memorandums and
publication. One caught her attention, and out of curiosity, she gazed at the organizational
chart. The organizational chart is composed of different dignitaries and their respective
positions who are working in the said company. The structure started from the highest
rank to the lowest rank. At the back of her mind, she wants to be listed there someday.
During her interview, another two different organizational charts again caught
her attention. She was really curious at that time about it and yet managed to ace the
interview with a good score. While leaving the room, she aspired herself to be included in
the chart one day by working hard.
After sometime, Miss Lydia then realized that once she becomes a new employee, she
must learn what an organization is, its management, its operation, its people, and its
strategies. With that in mind, she made a research about the organizational chart and it
goes like this:
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3 Major Types of Organization Structure
Directions: Read and analyze the following questions. Choose the letter of your
answer from the given choices. Place your answer in a separate sheet of paper.
1. What structure is identified with a hybrid of the two structures that caters
the function and division?
A. Line C. Functional
B. Matrix D. Divisional
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B. Matrix D. Divisional
5. Which among the choices below is identified as a broad organizational structure
that is usually represented with organizational charts and with position
descriptions?
A. tall C. formal
B. flat D. informal
Discover
Mr. Pedro needs to clarify and at the same time, classify the advantages and
disadvantages of the three (3) options. He called his lawyer to help him and they
discussed the following:
3 Options of an Organization
(1) Single Proprietor / Owner, one person holds the entire operation as his
/ her personal property and managing it on his / her own.
Advantages:
b. Tax Benefits – no requirement to file a separate business report. One will list
the business information and figures within his/her individual tax return. The
business will be taxed at the rates applied to personal income, not corporate taxes.
Disadvantages:
a. Liability – the business owner will be held directly responsible for any losses,
debts or violations coming from the business.
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b. Taxes – while there are many tax benefits to sole proprietorships, a main
drawback is that the owner must pay self-employment taxes.
c. Lack of “Continuity” – the business may discontinue if the owner become
deceased or incapacitated.
d. Difficulty in Raising Capital – generating the capital or the initial funds is
usually provided by the owner. Sole proprietorship does not issue stocks or
other money-generating investments unlike corporations.
(2) Partnership, requires more than one person in the decision-making process,
it’s important that potential business partners discuss a wide variety of issues up
front and develop legal partnership agreement. Advantages:
Disadvantages:
a. Joint and Individual Liability – partners are also liable for the business
debts and decisions made by other partners. The personal assets of all
partners can be used to satisfy the partnership’s debt.
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c. Shared Profits – each partner must share the successes and profits of their
business with the other partners. An unequal contribution of time, effort, or
resources can cause dispute among partners.
Advantages:
a. Separate Legal Personality – A corporation, once registered with the
Securities and Exchange Commission and is issued a certificate, has acquired
a legal personality separate and distinct from its stakeholders.
Shareholders of a corporation are not liable to obligations of the
corporation’s contracts into like debts, negligence or wrongful acts of the
corporation. The maximum loss of money a shareholder can incur is just
the amount of his/her investment in the corporation the value of his /her
stock.
b. Ease of raising funds – it is easy to raise additional funds since it has the option
to sell shares of the corporation.
c. Continuity – it can have a perpetual existence, which means it can outlive its
owner because it is a separate person in the eyes of the law. This means
investors don’t have to worry about the untimely demise of the owners.
d. Ease of Transfer of Ownership – the board of directors can
authorize the issue of shares of stocks in exchange for investors’
capital infusion into the company.
e. Credibility – a business with an Incorporation or “Inc.” sign after its
name often sounds more credible in the business context. One most
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likely attracts more partners, customers, and attention from the
community.
Disadvantages:
a. More time and money spent in organizing – it will require more time and
money than forming other sole and partnership business type.
c. Higher Tax – corporate profits may be subject to higher overall taxes since
the government imposes taxes on profits at the corporate level and again at
the individual level, if such profits are distributed to the shareholders.
d. More costly – there are required number of board meeting and annual
shareholder meetings/ sessions, all of these meetings/sessions will incur
expenses. As well as the services of attorney and accountant with drafting
legal documents and corporate filings.
B. Marketing Management
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C. Operations Management
D. Financial Management
- the goal of any finance function is to ensure the set up of effective and efficient
internal process designed to achieve business support service, lowest costs and
effective control of the environment while being vision- oriented, growth focused,
intuitive and risk taking.
- it has the responsibility to ensure that it manages the procurement process and the
supply base effectively and efficiently.
F. Office Management
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Once a business plan has been established, a manager can begin to organize.
Organizing involves assigning tasks, grouping tasks into departments, delegating authority
and responsibility, and allocating resources across the organization. Basically, the nature
of organization can be viewed in two (2) ways: (1) Organization as a process and (2)
Organization as a structure or framework of relationship. Organizations can achieve
higher sales and other profits by properly matching their needs with the structure they use to
operate.
An organization may come in different shapes and sizes. It can be “tall”, those that
have many tiers between the worker and the owner of the company, or they can be “flat”,
it means there are very few levels between the worker and the owner.
The basic organization framework is called the Line Structure. It has only direct,
vertical, relationships between different levels in the firm where similar activities are
performed at a particular level. Each group of specialists can therefore operate independently,
with management acting as the point of cross- communication between
functional areas. Line departments are directly involved in accomplishing the primary
goals of the organization. In a line organization, authority follows the chain of command.
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Advantages:
Disadvantages:
There are two (2) functions that can be used in making the organization structure. A
line function is a position that has a direct chain of command that is responsible for the
achievement of an organization’s goals.
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On the other hand, a staff function is intended to provide expertise, advice and
support for the line positions. (example of Staff Functions: HR, Quality Assurance, and
Corporate Planning)
There are several variations of organizational structures and there are three
(3) common types of it.
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Figure 4. Sample of Functional Structure. Adapted from Organization and
Management by Payos, Ranulfo P. et al. (2016).
(2) Divisional, this is typically used in larger companies or organizations with several
branches or outlets that operate in a wide geographic area or that have separate
smaller organizations within the umbrella group to cover different types of
products or market areas. It provides significant benefit which addresses needs more
rapidly and more specifically.
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(3) Matrix, this is hybrid of the 2 structures: functional and divisional. It is typically
used in large multinational companies, the matrix structure allows for the benefits
of functional and divisional structure to exist in one organization. This structure
is flexible and balance decision making.
Disadvantage: this can create power struggles because most areas of the company
will have a dual management. It can lead to confusion among employees due
to conflicting orders from multiple sources.
There are two (2) broader organizational structure that can be identify: first is the
formal organization, where it is usually represented with organizational charts and
with position description and there is a clear reporting relationship that the manager is
aware of. Secondly the informal organization, is a set of evolving relationships and
patterns of human interaction within an organization that actually do exist but are not
officially prescribed. There is also the presence of an informal leaders who sometimes exert
influence to organizational behavior.
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Explore
Here are some enrichment activities for you to work on master and
strengthen the basic concepts you have learned from this lesson.
Assessment 1
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4. An organization is basically a group of people who work together
according to their role and responsibilities
according to authority
to achieve different goals and objectives
to coordinate their actions while establishing connection
Assessment 2
Directions: Look for the term/s that corresponds to the nature and role of firm from
the box. Write your answer on a separate sheet of paper.
business network service -
management
cellphones support service hardware and oriented
of people
maintenance of software setting
effective the process of
satellite selection and compensation
control of the work
system placement and benefits
environment training and
satisfying the manufacture
supply computer
consumer setting development
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Assessment 3
Assessment 4
Directions: Complete the paragraph below by providing the correct words in the blank.
Rewrite the whole paragraph with the correct words in a separate sheet of paper.
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Great job! You have understood the lesson.
Are you now ready to summarize?
Deepen
Activity 1
At this point, you have to differentiate the three (options) of the nature of an
organization by completing a table. The scoring rubric on the next page will be
used in assessing your outputs.
2. Complete the table below on how you understood the topic. Use a
separate sheet of paper for your output. See Table 1 for your
reference.
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2.
3.
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and errors per page in use of few errors per page in throughout in use of
Mechanics Standard English rules of use of Standard Standard English
grammar, spelling, English rules of rules of grammar,
punctuation, grammar, spelling, spelling, punctuation,
capitalization, and usage punctuation, capitalization, and
that made the output capitalization, and usage
unclear or usage but did not
difficult to read affect overall clarity
Activity 2
1. Think of your dream business and write a short paragraph that describes
it and specify how will you put up your business through a business plan.
3. Make sure that the lines and arrows are congruent to one another.
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Table 2. Business Organization Structure
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specific, or specific, accurate,
accurate relevant data
Lacked sense of unity Adequate sense of Exceptionally clear
and order, unity and order, sense of unity and
Organization
ineffective / lack of most transitions order, logical
transitions effective transitions
Lacked smooth, Used smooth, clear, Used smooth, clear,
clear, readable readable writing readable writing in a
writing, contains throughout most of superior way
clichés and paper, few clichés, throughout , no clichés
Style
wordiness, occasional wordiness, or
generally ineffective generally appropriate wordiness,
word choice word choice consistently effective
Not more than a few word choice
More than a few errors per page in use Few, if any, errors
errors per page in use of Standard English throughout in use of
of Standard English rules of grammar, Standard English rules
rules of grammar, spelling, punctuation, of grammar, spelling,
Grammar
spelling, punctuation, capitalization, and punctuation,
and
capitalization, and usage but did not affect capitalization, and
Mechanics
usage that made the overall clarity usage
output unclear or
difficult to read
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Gauge
Directions: Read each item carefully. Write the letter of the correct answer. Use a
separate sheet of paper.
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5. What management is being referred to when a firm ensures that it
manages the procurement process and the supply base effectively and efficiently
like buying high quality products?
A. Operations Management C. Office Management
B. Material and Procurement Management D. ICT Management
7. Which of the following is considered as to having a higher tax among the options of
nature of an organization?
A. Sole Proprietor C. Corporation
B. Partnership D. Organization
11.What organization structure works very well for small businesses in which
each department can support itself by relying on the talent and knowledge of its
workers?
A. Line C. Functional
B. Matrix D. Divisional
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12.Which of the following product brand / companies uses the Matrix
Structure of organization?
A. Nike Apparel C. Glow Dishwashing Liquid
B. Marikina Footwears D. Creamline Ice Cream
14.In a functional structure, how does communication occurs within each functional
department?
A. President C. CEO
B. Chief Communication Officer D. Department Heads
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References
Printed Materials:
Website:
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KEY ANSWER
Jumpstart:
Activity 1: Activity 2:
1. B 1. B
2. C 2. D
3. A 3. A
4. D 4. C
5. C 5. C
Explore
Assessment 1:
Assessment 2:
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Assessment 3:
Assessment 4:
1. organization
2. flat
3. tall
4. line structure
5. staff
6. line
7. functional
8. divisional
9. matrix
10.informal organization
Deepen
Activity 1 – Answers vary. See rubric for checking
Activity 2 – Answers vary. See rubric for checking Gauge
1. A
2. D
3. D
4. C
5. B
6. A
7. C
8. B
9. B
10.D
11.C
12.A
13.C
14.D
15.C