LESSON1: ENGINEERING MANAGEMENT THE CLASSICAL ECONOMISTS
ADAM SMITH (1723- 1790)
- functional management
- career that brings together technological
- specialized form of management
MANAGEMENT FUNCTIONS
PLANNING - basic function of management.
ORGANIZING - process of bringing together physical
STAFFING - function of manning
DIRECTING - managerial function which actuates
CONTROLLING - implies measurement
LESSON2: MANAGEMENT
ENTREPRENEURSHIP - primarily an economic activity
ECONOMIST - expert who studies relationship
STRATEGY - plan of action or policy
STAGNATION - total output either declining
GROSS DOMESTIC PRODUCT - Measures monetary value
NATURE AND IMPORTANCE OF ENTREPRENEURSHIP
ECONOMIC ACTIVITY
- involves the creation and operation
- production and distribution of goods
ENTREPRENEURSHIP INVOLVES INNOVATION
- involves doing things in a new
- involves changing, revolutionizing,
GOAL- ORIENTED ACTIVITY - seek to earn profits
VALUE CREATION - created contribute some
A FUNCTION OF RISK BEARING
- Risk inherent and inseparable element
- works under uncertainties
ENTREPRENEURSHIP IMPLIES GROWTH
- growing a business and pursuing opportunities
- not about standing still or being stay
ECONOMIC DEVELOPMENT AND GROWTH
CONCEPT AND THEORIES
EARLY THEORIES - understanding economic growth
DEVELOPMENT THEORIES - attempt to explain conditions
necessary for development
Mercantilism
- popular at the start of Industrial
Revolution.
- country could be made better off by
seeking to accumulate gold.
Classical Growth Theory
- developed by (mostly British) economists
- Two important theorists Adam Smith and David
Ricardo.
- explains economic growth because of capital
accumulation
- 18th century Scottish economist,
- father of modern economics.
- laissez-faire policies.
- 1776 book, "The Wealth of Nations."
- division of labor among workers
DAVID RICARDO (1723-1772)
- classical economist
- 1817 book, "Principles of Political Economy and
Taxation”.
CLASSICAL ECONOMISTS’ EMPHASIS CLASSICAL GROWTH
THEORY
LAISSEZ-FAIRE ECONOMIC THEORY
- economic philosophy of free-market capitalism
- “laissez-faire” French “leave us alone” or “let do.”
CAPITAL ACCUMULATION
- increase in assets from investments
- grow wealth can include appreciation
PROFITS
- financial benefit realized when revenue generated.
DECLINE IN PROFIT - tend to reach certain height
STATIONARY STATE - condition of economic stagnation
Neoclassical Growth Theory
- Robert Solow and Trevor Swan in 1956.
- outlines how a steady economic growth rate
New Growth Theory
- Paul Romer and Robert Lucas.
- presumes the desire and wants
Unified Growth Theory
- Oded Galor.
- Explains economic history including Malthusian
- give better understanding of driving forces
THREE REGIMES
STAGNATION: MALTHUSIAN REGIME
- world in a low-level equilibrium
TAKE-OFF: POST- MALTHUSIAN REGIME
- marks the initial take-off
- technological progress accelerates
SUSTAINED GROWTH: THE MODERN GROWTH REGIME
- triggered by rise in the demand
- rapid technological progress
CONTRIBUTIONS OF ENTREPRENEURSHIP
WEALTH CREATION AND SHARING
- invest their own resources
- mobilizes public wealth and allows people to benefit
CREATE JOBS - by nature and definition job creators.
BALANCE REGIONAL DEVELOPMENT
- setting up new business and industrial units
- help with regional development
GROSS NATIONAL PRODUCT &PER CAPITA INCOME
- always on lookout for opportunities
STANDARD OF LIVING
- create businesses not just to create jobs
EXPORTS
- want to get started with
- important ingredient of economic development
COMMUNITY DEVELOPMENT
- requires infrastructure for education
ROLE OF GOVERNMENT IN ENTREPRENEURIAL DEVELO
- Active policies like tax incentives could be of help to some
specific businesses.
- Passive policies creating conducive environment
THE MOST SUCCESSFUL STRATEGIES GOVERNMENTS USE TO
ENCOURAGE ENTREPRENEURS:
EASY ACCESS TO CAPITAL - someone who puts money at risk
CELEBRATE AND PUSH FORWARD SMALL BUSINESS
- growth of entrepreneurship by promoting existing
entrepreneurs
CONDUCIVE TAX AND REGULATORY ENVIRONMENT
- country’s tax code use to promote growth of small businesses.
PROTECT INTELLECTUAL PROPERTY RIGHTS
- laws protect innovations of entrepreneurs.
- Policies protect copyrights
Micro, Small and Medium Enterprises (MSMEs):
• MICRO- Asset is 3 million below, Employees 9 or less.
• SMALL- Asset is 3 to 15 million, Employees 9 to 99.
• MEDIUM- Asset is 15 to 100 million, Employees
100 to 199.
• LARGE- Asset is 100 million above, Employees 200
above.
GOVERNMENT PROGRAM FOR MSMEs IN THE
SMALL AND MEDIUM ENTERPRISE ROVING ACADEMY
- continuous learning program for the development of
MSMEs
PONDO SA PAGBABAGO AT PAG-ASENSO (P3)
- quick access to capital
REPUBLIC ACT. 9178
- Barangay Micro Business Enterprises Act of 2022
KAPATID MENTOR ME - free education and training
GO LOKAL! - market access platform for MSMEs
LESSON 3: BUSINESS OPPORTUNITIES IN SMALL BUSINESS
CHARACTERISTICS OF ENTREPRENEUR
- Being an entrepreneur requires specific skills.
CREATIVITY - All business starts with an idea.
PASSION - what drives entrepreneurs.
MOTIVATION - will to accomplish certain things.
PRODUCT SERVICE AND KNOWLEDGE
- know what they have to offer
ABILITY TO NETWORK - ability to connect with people
SELF-CONFIDENCE -believe they can achieve their goals.
OPTIMISM - dreamers with a plan in . see positive side
VISIONS - see big picture they wish
GOAL MINDSET - know what they want to achieve,
RISK-TAKING - plan for the unknown
PERSUASIVENESS - know their business and how to talk
DECISION MAKING - make quick decisions and take action
TENACITY - overcome challenges. persevere
MONEY MANAGEMENT -understand the financial situation
ADAPTIBILITY - need to multitask. Flexibility in schedule
DETERMINANTS OF SUCCESS FOR ENTREPRENEUR
DEFINED VISION - corporate vision scripted understanding
RELEVANT KNOWLEDGE OF THE BUSINESS MARKET
- person or company must do their homework
- person or company must do their homework
DETAILED BUSINESS PLAN
- Knowing about industry and sketching out a vision
- business plan covers all related factors that essential
ASSESSMENT OF DIRECT AND INDIRECT COMPETITION
- getting ready to implement a new business
WELL-MANAGED SUPPLY CHAIN
- keep the right mix of products
WELL-DEVISED DECISION- MAKING SYSTEM
- Decision-making heart of any business
GOVERNMENT REGULATORY MEASURES
- final reason for business success or failure is how
much owners of enterprise have good grasp of rules
BIG AND SMALL BUSINESS FEATURE
DEALINGS IN GOODS AND SERVICES
- Business deals with goods and services.
- Goods are divided into consumer goods and
producer goods.
PRODUCTION AND EXCHANGE
- carried out only when goods and services are produced
- Buyer and seller
CONTINUITY AND REGULARITY IN DEALINGS
- activity said to be a business when it maintains
continuity and regularity.
PROFIT OF MOTIVE
- main and the foremost motive of business is to earn profit.
- Profits important to enable the business to survive
ELEMENT OF RISK - Risk possibility of incurring loss.
ECONOMIC CONTRIBUTIONS OF SMALL BUSINESSES
- SMEs backbone of the global economy.
COMMUNITY INVOLVEMENT - Small business owners are an
important part of the communities
COMMUNITY HEALTH - community's unique identity
INCREASING THE TAX BASE - residents shop at small business
LOCAL JOBS - Small business are 30 creators
INNOVATION AND COMPETITION - need to stand out from
the crowd
LESSON 4
PLANNING, ORGANIZING, AND MANAGING ENTERPRISE
Business Plan - essential written document
OUTLINE OF A BUSINESS PLAN
INTRODUCTION - contains a general overview
EXECUTIVE SUMMARY - capture reader's attention
ORGANIZATION AND MANAGEMENT -explains business runs
OPPORTUNITY RECOGNITION - recognize all opportunities
MARKETING ASPECT -proper handling and promotion
TECHNICAL ASPECT -equipment, locations, and other
ECOLOGICAL AND LEGAL ASPECT - impact on environment a
PLAN FOR GROWTH - must have long term goal
The Nature of Organizing - involves assigning tasks
BENEFITS OF ORGANIZING
- harmonizes employees
- aids business efficiency
- good organizational structure
PROCESS OF ORGANIZING ENTERPRISE
DETERMINING ACTIVITIES -depend upon ature and size
GROUPING OF ACTIVITIES -helps to secure specialization.
ASSIGNING DUTIES - Each person is given a specific job
COORDINATING ACTIVITIES - ensure effective performance
DELEGATING AUTHORITY Every individual given the authority
MANAGING THE ENTERPRISE
- Entrepreneurs start an enterprise and manage it effectively
EFFECTIVE COMMUNICATION
- Communication is the key to any business.
TIMELY BRAINSTORMING
- Brainstorming getting ideas from all the employees
DYNAMIC ENVIRONMENT - static or closed
AUTHORITY AND RESPONSIBILITY - equilibrium or balance
EFFECTIVE PLANNING
- best way to manage a business effectively
- best way to prepare for failure rather than success
RESULTS OF EFFECTIVE PLANNING:
Lower costs, fewer staff
Increased efficiency, eliminating problematic process
Higher accuracy, checkpoints and success measures
Greater understanding by all staff of what they need to do to
meet their department objectives.
TEAM WORK - fruitful and constructive.
M’S OF BUSINESS - 4 M's of business are the most
important resources any organization
THE 4M’S OF BUSINESS
MEN - contribute the human resources
MATERIALS - includes raw materials
MACHINERY - updated with newest technology.
MONEY -most significant resource
LESSON 5
15 SUCCESSFUL ENTREPRENEURS IN THE PHILIPPINES
1. HENRY SY - SM
2. TONY TAN CAKTIONG - Jollibee Foods
3. SOCORRO RAMOS - National Bookstore
4. JOHN GOKONGWEI JR. - J.G. Holdings
5. EDGAR SIA - Mang Inasal
6. MARIANO QUE - Mercury Drug
7. CRESIDA TUERES - Greenwich
8. CECILIO KWOK PEDRO-Lamoiyan Corporation
9. ALFREDO M. YAO - Zest - O
10. JOSE MAGSAYSAY - Potato Corner
11. LEELIN SISTERS - Goldilocks
12. ANGELINE THAM - Angkas
13. JOSE CONCEPCION JR. - RFM Corp.
14. BEN CHAN - BENCH
15. CORAZON D. ONG - CDO Foodsphere
LESSON 6 SUCCESSFUL ENTREPRENEURS
1,080,810 - 2021 List of Establishments (LE) of the Philippine
Statistics Authority (PSA)
SUCCESSFUL ENTREPRENEURS
- All successful Entrepreneurs have a similar way of thinking
MARK ZUCKERBERG
- founder and CEO (2004) of Facebook,
- CourseMatch and Facemash.
LARRY PAGE
- Lawrence Edward Page, american computer scientist with
Sergey Brin, created online search engine Google.
- raised $1 million in outside financing.
- September 1998
CARLOS SLIM
- richest man in the world in 2010
- Grupo Galas parent company of a conglomerate
 LESSON 7
search for BUSINESS OPPORTUNITIES
Jeffry Timmons
MODELOFTHE ENTREPRENEURIALPROCESS
1. Opportunity (Idea, Customer, Timing)
2. Entrepreneur and the Management Team (Skills,
Character)
3. Resources (Capital)
START UP CAPITAL
Capital - sum of financial assets. used to initiate
operations.
DIFFERENT TYPES OF BUSINESS
Manufacturing - Converts material goods
Wholesaling - Buys goods in large quantities
Retailing -often from wholesalers,
Service - provide a wide variety of professional,
Special Type - Farming, Either wholesale or retail
Search For Business Opportunities:
OPPORTUNITIES IN RURAL ACTIVITIES
Rural Entrepreneurship - origin lies in the rural areas
RURAL ENTREPRENEUR TRIPLE OPTIONS
Manufacturing Unit -medium or small scale industry
Trading - buying and selling
Service Enterprise - both commercial and professional
Benefits of Starting BUSINESSIN RURALCOMMUNITIES
Less Competition - few competitors
More Affordableto Startup -require a lot of costs
Cheaper Mortgage - cost of living
Contribution to Rural Economy - directly helping place
Access to Materials Needed - makes a lot of sense
Rural Communities are often very Loyal
- develop customers for life
search for business opportunities:
COMMUNITY RESOURCES AND NEEDS
What do we mean by Needs And Resources?
Needs - need to fulfill. consumer must have
Resources - include individuals, used to improve the
quality of life.
LESSON 8
INDUSTRIAL REVOLUTION (1800)
Capitalism - emphasizes profit maximization
SOCIALISM - Emphasizes collective goals
TASK ORIENTED LEADER
- autocratic leadership.
- doesn’t care as much about relationship
- sees a goal, creates a step-by-step plan
PEOPLE ORIENTED LEADERS
- democratic leadership,
- heavily involving team members
- work culture is more important.
- uses relationship-building techniques,
- create a workplace environment
A PEOPLE ORIENTED CULTURE IS A MUST IN A
WORKPLACE!
Empathy is Essential - crucial for understanding
Offer Constructive Feedback - regular conversations
Foster a Positive Work Environment
- Recognition and praise
Show People they are Valued - vital “cog”
A Focus on Work-Life Balance
- People feel more like people
“Many ideas grow better when transplanted in to
another mind than the one where they sprang up.”
-Oliver Wendell Holmes
SOCIAL RESPONSIBILITY
- Corporate social responsibility (CSR)
- obligation to make decisions and perform them
TYPES OF CORPORATE SOCIAL RESPONSIBILITY
Economic Responsibility - producing goods and services
Environmental Responsibility - environmentally friendly
Ethical Responsibility - beyond the laws
Discretionary Responsibility - philanthropic
BUSINESS SUCCESS THROUGH PEOPLE
Starbucks - largest coffeehouse Seattle, Washington.
Square Space - website builder
Google - internet search engine.
Facebook - exploded in growth
 LESSON 9
FINANCIAL MANAGEMENT
- Means planning, organizing, directing
FINANCIAL MANAGEMENT PROCESS
Managing Scarce Resources - Organizations operate
- funds and resources are used properly
Managing Risks - must be identified
Managing Strategically - keep an eye
Managing By Objectives - close attention to projects.
- project management cycle - Plan, Do, Review
KEY OBJECTIVES OF FINANCIAL MANAGEMENT
Plan and Map Out Goals Clearly - Planning a roadmap
Organize Financial Assets record all relevant information
Grow Revenue Passively - earn it passively. investment st
Communicate with Clarity - talking with clients
- explain in simple
IMPORTANCE OFFINANCIAL MANAGEMENT
Helps with Financial Planning
- track your progress. reduce doubt
Helps In Funds Allocation
- financial manager. helping management allocate
Plans for Acquisition of Funds
- capital raised for buying another business is called
Acquisition Funding.
Ensures Financial Stability
- important components in financial management.
Encourages Good Money Planning Methods
- Teaching staff
2 ASPECTS OF FINANCIAL MANAGEMENT
1. Financial Accounting
- External use: shareholders,
- record financial performance
2. Management Accounting
- internal use: Managers and employees
- Management decides on the information
PRODUCTION - transform tangible inputs
MAIN METHOD OF PRODUCTION
Job Production
- jobbing or one-off production, producing custom work
Batch Production - small quantity of identical product
Mass Production - goods in large quantities
Flow Production - many thousands
- Marketing goals help define what you want to achieve
PRODUCTIVITY - rate at which accompany
GOODS AND SERVICES
- anything that satisfy human wants or needs.
CLASSIFICATION OF GOODS AND SERVICES
Free Goods and Economic Goods
- Free goods free gifts of nature.
- Economic goods manmade and limited
Free Services and Economic Services
- Free services cannot be bought
- Economic services can be bought
Consumer and Producer Goods
- Consumer goods satisfy wants of consumer.
- Producer goods satisfy wants of consumer
indirectly.
Consumer and Producer Services
- Consumer satisfy wants of or households
directly.
- Producer services used to produce other goods
and services
Single Use and Durable Use Goods
- Single Use Goods only used once.
- Durable Use Goods used for a long period of
time.
Private and Public Goods
- Private goods owned by a single individual,
- Public goods owned and used by society
MARKETING - business of promoting
STEPS IN MARKETING YOUR BUSINESS
Conduct Market Research
- Market research key part of developing market
strategy. collecting information
Develop Your Business Brand - need a brand.
Choose Your Marketing Avenues
-consider target audience
Identify Your Unique Selling Proposition
- USP unique reason
- what makes your business stand out from the crowd.
Profile Your Target Markets
- Trying to promote your product
- Grouping or segmenting potential customers
SEGMENTATION IS BASED ON FACTORS SUCH AS:
Geography – Location
Demographics – age, gender,
Behavior – loyalty, attitude
Lifestyle – social class, personality, personal values
Set Your Goals And Budget
SMART: Specific, Measurable, Attainable, Relevant, and
Time Based.