Organization

and
Management
LESSON 1: NATURE AND CONCEPT OF MANAGEMENT

Management is a science as well as an art. It is a body of knowledge whose ideas and principles have
Become the basis of organization frameworks employed by many businesses and organizations. It is
considered a science because it evolved from a number of theories that involved extensive studies and
experiments. The management principles practiced by business people and professionals are based on
scientific principles, scholarly studies, and statistical data. The problem-solving nature of management
benefits greatly from methods and practices adopted from scientific principles.

However, many management experts point out that management is not an exact science like
mathematics. Despite the accuracy of data from statistics, the use of mathematical tools is only one
aspect of management.

A good manager must be able to look at situations and use creativity and imagination in coming up
with solutions to problems. It is in this aspect that one can consider management as an art. Creativity
and ingenuity are important traits of managers that enable them to effectively use business strategies
in any situation, and make innovations that result in new products, services, and processes. This
ingenuity can be drawn from the effective application of knowledge and skills of decision-makers.

MEANING OF MANAGEMENT

Management is the process of planning, organizing, leading, and controlling the activities of an
organization effectively and efficiently.

EFFICIENCY AND EFFECTIVENESS

• Efficiency is the ability to maximize output with minimum input. "Doing things right". Avoid
wasting time and effort.
• Effectiveness is the capacity to attain an intended objective or result. "Doing the right thing"

FACTORS INFLUENCING MANAGEMENT

1. Globalization - It refers to the phenomenon of growing interconnectivity and interdependent

relations between nations.
2. Technology - It is one of the main driving forces of business.
3. Sustainability and Corporate Social - Sustainability in business means that companies should plan
and conduct long-term business operations to ensure minimal negative impact on the social, cultural,
and economic aspects of their external environment or community.
Corporate social responsibility, meanwhile, is defined as the willingness of companies to run their
business operations in a sustainable and responsible manner.
4. Psychology - A better understanding of psychological concepts such as motivation, behavior,
attitude, and personality is vital for effective management.
5. Ecosystems - A business ecosystem consists of a group of firms that provide related products and
services.
MANAGEMENT THEORIES

1. Scientific Management Theory ( Frederick W. Taylor) "studies the application of scientific methods
and principles for the purpose of redesigning the work process to increase efficiency.

2. Administrative Management Theory (Henri Fayol) "focuses on the overall management of an

organization, emphasizing the role of managers as administrators of the organization. Five functions
are planning, organizing, communicating, coordinating, and controlling.

LESSON 2: MANAGERS

The main functions of management are planning, organizing, leading, and controlling. There are 3
major roles if managers are the interpersonal, informational, and delusional roles.

Managers should possess key management skills to effectively perform their duties. These skills are
conceptual skills or the ability to analyze and solve different kinds of problems and scenarios; human
skills that include a proficiency in dealing and transacting with different kinds of people; and technical
skills, which refer to competitive skills required in their respective jobs.

THREE LEVELS OF MANAGEMENT

1. Top-level Management – responsible for strategic decision for the company.

2. Middle-level Management – responsible for carrying out the decision of the top-level management
3. Lower-level Management – consists of managers or supervisors who report to middle managers and
are responsible for the employees or workers under them.

MANAGEMENT SKILLS

1. Conceptual Skills
2. Human Skills
3. Technical Skills
LESSON 3: FIRMS AND IT’S ENVIROMENT

The business Firm’s environment refers to the conditions and elements that define its operations and
determine its success. There are two types of the firm’s environment. These are the internal and external
environment.

▪ Internal environment – consists of elements that have direct impact on the business operations.
These includes the employees, the board of directors and managers.

▪ External environment – consists of factors that have indirect but significant influence on the
operations or the business. These factors, however, cannot be controlled by the firm.

▪ Microenvironment – is also known as the “operating environment”. It consists pf the customers,

suppliers, regulatory agencies, and competitors.

▪ Macroenvironment – is also known as the “general environment”. It consists of the economic

political, social, legal, and technical environment of the business organization.

STRATEGIC PLANNING TOOLS:

Analyses provide companies with a more objective view of the business environment and enable
managers to recognize opportunities and effectively address threats.

1. SWOT – Strengths, Weaknesses, Opportunities and Threats.

2. PEST – Political Factors, Economic Factors, Social factors and Technological Factors Internal
LESSON 4: FORMS OF BUSINESS

FORM OF BUSINESS / TYPES OF BUSINESS OWNERSHIP

Sole Proprietorship
Companies owned by one person who is usually hands-on in managing the day-to-day activities.

Partnership
A form of business organization where ownership of the business is shared by two or more members.

Corporation
It has a distinct personality separate from its owners. This means that it is treated like an individual
person with benefits from certain rights as well as obligations and responsibilities.

Other Form of Business:

Cooperative
A cooperative is a business organization owned by a group of individuals and is operated for their
mutual benefit.

CLASSIFICATION OF BUSINESSES

1. Service business – type of business that provides labor and other services to the customers

2. Merchandising business – type of business that purchase products from other businesses like
manufacturers and sells them to customer at a higher retail price.

3. Manufacturing business – type of business where raw materials is transformed into finished
goods through product-processing, labor and other manufacturing processes