ORGANIZATION AND MANAGEMENT

(Grade 11 Module)
Nature and Concept of Management
Objective:
At the end of the Chapter, students may be able to:
Discuss the meaning and functions of management
Explain the various types of Management Theories
Explain the function, roles and skills of a manager
Understand the basic concept and Theories of management
Apply management theories and concepts in dealing with business problems
Overview
In this chapter, we will discover that all organizations, public or private,
large or small, profit or non-profit – needs good managers in order to accomplish goals and
managing organization requires effectiveness and efficient action to carry out
OVERVIEW OF MANAGEMENT
Management
people business organization
(concern) (how it become productive)
IMPORTANCE OF MANAGEMENT
Make resources into productive unit of economy (growth)
Talks also on services rendered not only on profit
Purpose of producing quality management – effective management to the public
Definition and Functions of Management
Management is the process of coordinating and overseeing the work performance
of individuals working together in organization so that they could efficiently and effectively
accomplish their chosen aims or goals
Management is the process of designing and maintaining an environment for
efficiently accomplishing selected aims
MEANING OF MANAGEMENT
FREDERICK TAYLOR FATHER OF SCIENTIFIC MANAGEMENT
says that management is knowing exactly what you want men to do, and then seeking that they
do it in the best and cheapest way
MEANING OF MANAGEMENT
Function of executive leadership in making vital decision, that is, directing the business toward
the attainment of company’s plan, objectives and affairs and the way to make orders and
decisions to their employees
* Meaning - Management is Directing Business and Directing employees
MANAGEMENT AS SCIENCE & ART
AS SCIENCE
Systematic study through analysis and observation
- of knowing how things are done through the help and cooperation of others in getting the
results
FUNCTIONS OF MANAGEMENT
Planning
Organizing
Staffing
Leading
Coordinating
Reporting and Communicating
Budgeting
FUNCTIONS OF MANAGEMENT
1. PLANNING – outlining the things to be accomplished. It involves determining the
organization’s goals or performance objectives, defining strategic actions that must be done to
accomplish them, and developing coordination and integration activities.
FUNCTIONS OF MANAGEMENT
2. ORGANIZING – the establishment of a formal structure of authority. Demands assigning
task, setting aside funds, and brining harmonious relations among the individuals and work
groups or teams in the organization
FUNCTION OF MANAGEMENT
3. STAFFING – recruitment and trainings of work force (no mismatch). Indicates filling in the
different job positions in the organization’s structure; the factor that influence this function
include: size of the organization, types of jobs, number of individuals to be recruited, and some
internal or external pressures
FUNCTION OF MANAGEMENT
4. LEADING – making decisions and giving orders. Entails influencing or motivating
subordinates to do their best so that they would be able to help the organization’s endeavor to
attain their set goals
FUNCTIONS OF MANAGEMENT
5. CONTROLLING/ COORDINATING – bringing together the various processes of doing
works. It Involves evaluating and, if necessary, correcting the performance of the individuals or
work groups or teams to ensure that they are all working toward the previously ser goals and
plans of the organization
FUNCTIONS OF MANAGEMENT
6. REPORTING AND COMMUNICATING - establishing rapport with superiors and
subordinates
7. BUDGETING – includes fiscal planning, accounting and control
Coordination, Efficiency, and Effectiveness: Intrinsic to the Nature of Management
Functions of Management will all go to waste if Coordination, Efficiency, and
effectiveness are not practiced by an organization’s appointed managers.
Top level managers, middle level managers and team leaders or supervisors must
all be conscious of the said practices of successful organizations as they perform their
management functions
Coordination
Coordination means the harmonious, integrated action of the various parts and
processes of an organization.
Coordination ensures that all individuals, group, or teams are harmoniously
working together and moving toward the accomplishment of the organization’s vision, mission,
goals and objectives
Efficiency
Efficiency means the character of being efficient or being able to yield the
maximum output from a minimum amount of input.
 Efficiency refers to the optimal use of scarce resources – human, financial,
physical and mechanical, in order to bring about maximum productivity
Effectiveness
Effectiveness mean being adapted to produce an effect, or being able to do things correctly.
Effectiveness means doing things correctly when engaged in activities that will help the
organization attain its aims
Evolution of Management
Studying the evolution of management theories will help us understand the beginning of the
present-day management practices; why some are still popular and why others are no longer in
use; and why the expansion and development of these theories are necessary in order to adapt to
the changing times
Scientific Management
Scientific Management Theory
This management theory makes use of the step by step or scientific methods in findings the
single best way for doing a job. Frederick W. Taylor (1856-1915) known as the Father of
Scientific Management; while working in a steel company in US as a mechanical engineer
noticed the workers’ mistake, and efficiencies in doing their routine jobs, their lack of
enthusiasm, and discrepancy between their abilities and aptitudes and their job assignments thus
resulting in low output
Scientific Management Theory
Frederick W. Taylor (1986-1915) rested his philosophy on four basic principles for the
improvements of their productivity to wit:.
1. The development of a true science of management so that the best method for performing each
task could be determined.
2. The Scientific selection of workers so that each workers would be given responsibility for the
task for which he or she was best suited.
3. The scientific education and development of workers.
4. Intimate friendly cooperation between management and labor.
Classical / General Administrative Theory
General Administrative Theory / Classical Theory
HENRI FAYOL (1841-1925) is generally hailed as the founder of the classical
management school –not because he was the first to investigate managerial behavior but because
he was the first to systematize it.
FAYOL were concerned with managerial activities which he based on his actual
experience as a managing director in a big coal mining company. He believe that management is
an activity that all organizations must practice and viewed is as a separate from all other
organizational activities such as marketing, finance, research and development and others
Management Principles of Henri Fayol
1. Work division or Specialization / Division of Labor
2. Authority
3. Discipline
4. Unity of Command
5. Unity of Direction
6. Subordination if Individual interest to general interest
7. Remuneration / Pay
Management Principles of Henri Fayol
8. Centralization
9. The Hierarchy or chain of authority
10. Maintenance of Order
11. Equity / Fairness
12. Stability / Security of Tenure of Workers
13. Employee Initiative
14. Promotion of team Spirit or esprit d Corps
General Administrative Theory / Classical Theory
Max Weber, a German Sociologist, wrote in the early 1900’s that ideal organization especially
large ones, must have authority structures and coordination with other based on what he referred
to as bureaucracy (present day organization uses webers’ structural design)
Management Principles of Max Weber
According to Weber, bureaucracy is an organizational form distinguished by the
following components:
1. Division of Labor
2. Hierarchical identification of job positions
3. Detailed rules and regulations
4. Impersonal connections with one another
Modern Management theory
Total Quality Management of Edward Deming (1900 – 1993) and Joseph M. Juran (1904-2008)
Total Quality Management is a management philosophy that focuses on the satisfaction of
customers, their needs and expectations
Deming and Juran introduced this customer-oriented in the 1950s; but the concept was not totally
accepted.
The Americans did not immediately take to the idea since the US was enjoying supremacy in the
global market at the time
Total Quality Management of Edward Deming (1900 – 1993) and Joseph M. Juran (1904-2008)
Japanese manufacturers, on the other hand, took notice of it and enthusiastically experimented on
its application. When Japanese firms began to be recognized for their quality products, Western
managers were forced to give more serious consideration of demings’ and Jurans’ modern
management philosophy that eventually became the foundation of today’s quality management
practices
Deming’s 14 Points for Top Management
Create constancy of purpose for improvement of products and services
Adopt the new TQM Philosophy
Cease dependence on mass inspection by doing things right and doing it right the first time
End the practice of awarding business on the basis of price alone
Constantly improve the system of production and services
Institute Trainings
Deming’s 14 Points for Top Management
7. Adopt and institute Leadership
8. Drive out fear
9. Break down barriers between staff areas
10.Eliminate Slogan, focus on correction of defects of system
11. Eliminate numerical quota for the work force
12. Remove barriers that rob people of “Pride of workmanship”
13. Encourage education and self-improvement
14. Take action to accomplish the transformation
Fitness of Quality according to Juran
1. Quality of design
– through market research, product and concept
2. Quality of conformance
– through management, manpower, and technology
3. Availability
– through reliability, maintainability, and logistic support
4. Full Service
– through promptness, competence, and integrity
Juran’s Quality Planning Roadmap
Identify your customers
Determine their needs
Translate them into one’s language
Develop a product that can respond to needs
Develop processes which are able to produce those product features
Prove that the process can produce the product
Transfer the resulting plans to the operating forces
Functions, Roles and Skills of a Manager
An individual engaged in management activities is called manager.
Managers supervise, sustain, uphold, and assume responsibility for the work of others in his or
her work group, team, department, or the organization, in general
Functions, Roles and Skills of a Manager
Organizations have three level of management with their respective managers
these are :
1. Top level managers
2. Middle managers
3. Frontline or lower level of Managers
Level of Managers
Level of Managers
Top Level Managers
Top Level Managers are the general or strategic managers who focus on long-
term organizational concern and emphasize the organization’s stability, development, progress,
and overall efficiency and effectiveness.
Traditionally, top level managers set company’s general direction by designing
strategies and by controlling various resources. At present, they must act also as organizational
guides who must elaborate on the wider purpose of their organizational existence so that their
subordinates could identify and be committed to its success
Level of Managers
Top Level Managers
Top level managers are concerned too with the organizations’ inter-relationship
with their external environment
Chief Executives Officers (CEO), Chief Operating Officers (COO), Presidents,
Vice Presidents are example of top level managers in big corporations
Middle Managers
Middle Managers
Middle level managers are the tactical managers in charge of the organization’s
middle level or departments. They formulate specific objectives and activities based on the
strategic or general goals and objectives develop by top-level managers.
To be an ideal middle level manager, one must be creative so that they could
provide sound ideas regarding operational skills as well as problem-solving skills that will help
keep the organization afloat
Frontline Managers
Frontline / Lower Level Managers
Lower level managers are also known as the operational managers and are
responsible for supervising the organization’s day to day operation; they are the bridges between
management and non management employees
Managerial Roles according to Mintzberg
Management expert and professor Henry Mintzberg recognized this, and
he argued that there are ten primary roles or behaviors that can be used to categorize a manager's
different functions.
The Roles
Mintzberg published his Ten Management Roles in his book, "Mintzberg on
Management: Inside our Strange World of Organizations," in 1990.
The ten roles of managers
1. Figurehead
2. Leader
3. Liaison
4. Monitor
5. Disseminator
6. Spokesperson
7. Entrepreneur
8. Disturbance Handler
9. Resource Allocator
10. Negotiator

The 10 roles are then divided up into three categories, as follows:

Interpersonal Category
The managerial roles in this category involve providing information and ideas.
Figurehead – As a manager, you have social, ceremonial and legal responsibilities. You're
expected to be a source of inspiration. People look up to you as a person with authority, and as a
figurehead.
Leader – This is where you provide leadership for your team, your department or perhaps your
entire organization; and it's where you manage the performance and responsibilities of everyone
in the group.
Liaison – Managers must communicate with internal and external contacts. You need to be able
to network effectively on behalf of your organization.
Informational Category
The managerial roles in this category involve processing information.
Monitor – In this role, you regularly seek out information related to your organization and
industry, looking for relevant changes in the environment. You also monitor your team, in terms
of both their productivity, and their well-being.
Disseminator – This is where you communicate potentially useful information to your colleagues
and your team.
Spokesperson – Managers represent and speak for their organization. In this role you're
responsible for transmitting information about your organization and its goals to the people
outside it.
Decisional Category
The managerial roles in this category involve using information.
Entrepreneur – As a manager, you create and control change within the organization. This means
solving problems, generating new ideas, and implementing them.
Disturbance Handler – When an organization or team hits an unexpected roadblock, it's the
manager who must take charge. You also need to help mediate disputes within it.
Resource Allocator – You'll also need to determine where organizational resources are best
applied. This involves allocating funding, as well as assigning staff and other organizational
resources.
Negotiator – You may be needed to take part in, and direct, important negotiations within your
team, department, or organization
Managerial Skills
Managerial skills may be classified as conceptual, human and technical
Conceptual Skills
- Conceptual skills enable managers to think of possible solutions to complex problems.
Through their ability to visualize abstract situations, they develop a holistic view of their
organizational and its relation to the wider external environment surrounding it. Top level
managers must have these conceptual skills in order to be successful in their works
Managerial Skills
Human skills
- Human skills enable managers in all level to relate well with people. He/she must be
able to develop this human skills of dealing with people. Communicating, leading, inspiring, and
motivating them become easy with the help of human skills
Managerial Skills
Technical skills
- Technical skills are also important for managers for them to perform their task with
proficiency with the use of their expertise. Lower level managers find these skills very important
because they are the ones who manage the non management workers who employ varied
techniques and tools to be able to yield good quality products and services for their company
Chapter 2: The Firm and the Environment
The environment in which a business operates is a major consideration in determining an
organization’s design or structure. Uncertainty, procurement, and competition are linked with the
external environment
Environmental scanning can be defined as ‘the study and interpretation of the political,
economic, social and technological events and trends which influence a business, an industry or
even a total market’. The factors which need to be considered for environmental scanning are
events, trends, issues and expectations of the different interest groups.
It allows the organization to adapt and learn from that environment. When the company
responds to an environmental scanning process it allows them to easily respond and react to any
changes to both the internal and external business environment. Environmental scanning is a
useful for strategic management as it helps them to create and develop the aims and objectives of
the company which assists with the production of the company or organization.
A common formal environmental scanning process has five steps. The five steps are
fundamental in the achievement of each step and may develop each other in some form.
1) The first step of the environmental scanning process requires the identification of the needs
and the issues that have occurred that caused the organization to decide an environmental
scanning is required. Before starting the process there are several factors that need to be
considered which include the purpose of the scanning, who will be participating in the processes
and the amount of time and the resources that will be allocated for the duration of the scanning
process.
2) The second step of the scanning process is gathering the information. All the needs of the
organization are translated into required pieces of information that will be useful in the process.
3) The third steps analyzing all the information that the business have collected. When analyzing
the information organizations are made aware of the trends or issues that the organizations may
be influenced by.
4) The step four of the environmental scanning process is all about the communication of the
results obtained in step three. The appropriate decision makers analyze the translated information
of the potential effects of the organization. All the information is presented in a simple and
concise format
5) With all the information obtained from steps three and four, step five is all about making
informed decisions. Management creates appropriate steps that will position the organization in
the current business environment

External Business Environment

External Business Environment refers to the factors or elements outside the organization
which may affect, either positively or negatively on the performance of the organization

Internal Business Environment

Internal Business Environment refers to the factors or elements within the organization
which may affect, either positively or negatively on the performance of the organizations
Components of the External Business Environment: General and Specific
The general business environment includes the economic, socio-cultural, politico legal,
demographic, technological and world and ecological situations

Economic Situations
Inflations, interest rates, changing options in stock markets and people’s spending habits
are some examples of factors/elements of economic situations. Economic situations may affect
management practices in organizations.

Socio-cultural Situations
Socio-cultural Situations include the customers’ changing values and preferences;
customs could also affect management practices in companies. For example, Filipino customers
are now conscious about the importance of avoiding fatty foods, so many food companies now
make sure that the product they offer are cholesterol free or low in cholesterol

Politicolegal Situations
Politicolegal Situations refer to national or local laws, international laws, and rules and
regulations that influence organizational management. For example, labor laws related to
preventing employers from firing their employees without due process.

Demographic Situations
Demographic Situations such as gender, age, education level, income, number of family
members, geographic origin, etc may also influence some managerial decisions in organizations.
Decisions regarding hiring of human resource may be affected by an organization’s management
policy that shows prejudice to the hiring of married female who are n the child bearing age

Technological Situations
Technological Situations of companies involve the use of varied type of electronic
gadgets and advance technology such as computers, robotics, microprocessor, and others that
have revolutionized business management which change the ways business in conducted in the
21st century

World and Ecological Situations

World and Ecological Situations are related to the increasing number of global
competitors and markets, as well as the nature and conditions of the changing natural
environment. Products produced by companies must cater the changing needs of the people in
the global community while at the same time, considering their impact on the natural
environment

Specific Business Environment focuses on stakeholders, customers, suppliers, pressure groups,

and investors or owners and their employees

Stakeholders
Stakeholders are parties likely to be affected by the activities of the organization
Customers
Customers are those who patronize the organization’s product and services. Increasing
customer sophistication makes it necessary for managers of organizations to make crucial
decisions regarding the development of products with higher value and the improvement of their
services to meet their patron’s increasing demands

Suppliers
Are those who ensure the organization’s continuous flow of needed and reasonably
priced inputs or materials required for producing their goods and rendering their services.

Pressure groups
Are special-interest groups that try to exert influence on the organization’s decisions or
actions? Example is the government agency that prohibits the sales of lead content products

Investors or owners
Provide the company with the financial support it needs. The company, of course, cannot
exist without them; thus, they greatly influence organizational management

Employees
Are comprised of those who work for another or for an employer in exchange of salaries
or wages or other considerations. Employees execute the company’s strategies and are important
for the maintenance of the company’s stability