BPC1 • E ciency - getting the most output from the least

amount of inputs.
BUSINESS ORGANIZATION AND MANAGEMENT
• E ectiveness - completing activities so that
CHAPTER ONE: MANAGEMENT, AN OVERVIEW
organizational goals are attained.
• Management - universal; such practices are
applied in all types of organization, and determine
the development of a nation. The salient features which highlight the nature of
management are as follows:
• Management (Institution) - a ects the life of all
individuals. Management is:
• Organizations - managed by one or more people • Goal oriented - means to achieve certain goals.
who are called managers; a deliberate arrangement • Universal - essential element of every organized
of people to accomplish a speci c purpose. activity irrespective of the size or the type of the
• Managers - decide how an organization’s activity.
resources should be allocated. • Continuous process - the cycle of the
• Management Functions - the work to be management continues to operate as long as there
performed is organized action for the achievement of goals:
an ongoing process and is also a never ending
• Managerial Roles - the organized set of behavior
process.
to be performed.
• Multi-disciplinary - techniques, principles and
• Management Skills - master skills involved in
theories are drawn from other disciplines: it
performing the job.
depends on wide knowledge and practice derived
from various discipline.
Di erent De nitions of Management • Intangible force - evidenced by the results of its
As de ned by: e orts through others; is an unseen and invisible
force.
• Economists - a resource: land, labor, capital and
organization. • Situational - no best way of doing things;
conditions and situations must be taken into
• Bureaucrats - a system of authority to achieve
account.
business goals.
• System of authority - provides direction for every
• Sociologists - a part of the class elite in the
activity of an organization; forms system a
society. hierarchy of command.
• Science and an Art - a systematized body of
Common De nitions of Management knowledge and the application of obtained
Management is: knowledge and skills.

• The process of coordinating all resources

through Planning, Organizing, Sta ng, Leading Common Characteristics of an Organization
and Controlling. • Each has a distinct purpose
• The art of getting things done through other • Each is composed of people.
people.
• Each develops some deliberate structure; may be
• The utilization of scienti cally derived principles classi ed as either for-pro t or not-for pro t/non
to examine and improve collective e orts. pro t.
• The process of attaining organizational objective
in an e cient and e ective manner.
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 Major reasons on the need for organizations: • Top managers - CEOs, COOs, presidents, and
Organizations: vice-presidents; responsible for overall
coordination and direction—ultimately responsible
• Serve society - organizations are social institutions for the success or failure of an organization.
that re ect certain culturally accepted values and
• Middle level managers - department heads,
needs.
division managers, personnel directors; individuals
• Accomplish objectives - reach certain speci ed who manage other mangers—responsible for
goals. translating the goals set by top management.
• Preserve knowledge - store and protect; serve as • Lower Level Managers - supervisors, team
a bridge between past, present and future leaders, and foremen; responsible for directing the
generations, and add knowledge. day-to-day activity of operative employees.
• Provide careers - provide their employees with a
source of livelihood, personal satisfaction and self-
Level of Management
ful llment.
• Level of management - the hierarchical
arrangements of managerial positions in an
Signi cance of management organization.
• Development of the nation - a ects socio- • Top Level Management - responsible for the
economic and political development. overall management of organization
• From Managers perspective - the study of • Middle Level Management - responsible for the
management for those who aspire to assume implementation of polices and plans developed by
managerial position. top management.
• From non-managerial perspective - for those • Lower Level Management - the bottom of
who do not plan careers in management, an insight organization's hierarchy; the rst line, supervisory
into the behavior of their bosses and the internal or operational level management—directly
activities of the organization. managing operating employees and resources.

Management Functions Management Skills

• Planning - process of setting goals and choosing • Conceptual Skills - the ability of managers to
the means to achieve those goals. organize, coordinate, and integrate.
• Organizing - process of arranging and allocating • Human Skills - the ability of managers to work
work, authority and resource. with, communicate with, understand and motivate
• Sta ng - process of obtaining and maintaining individuals and groups.
capable and competent candidates for all job • Technical Skills - refers to the knowledge to
position. perform speci c tasks.
• Leading - process of directing and in uencing
organizational members to achieve goals.
Managerial Roles
• Controlling - process of ensuring that actual
• Managerial Roles - speci c categories of
activities conform to planned activities.
managerial behavior (Interpersonal roles,
Informational roles and Decisional roles).
Types of Managers
Managers are individuals who are responsible for Managerial and Organizational Performance
the work of the others.
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 • Organizational performance - measures how well • Internal Environment - the elements within the
the organization achieves the stated objectives. organization: employees, management, and
corporate culture.
• Managerial performance - measures how well the
manager determines and achieves appropriate
objectives. • Organizational mission statements - describes
what the organization stands for and why it exists.
CHAPTER TWO: MANAGERIAL ENVIRONMENTS • Company policies - guidelines that govern how
• Manager’s Environment - made up of constantly certain organizational situations are addressed.
changing factors both external and internal that • Formal structures - the hierarchical arrangement
a ect the operation of the organization. of tasks and people.
• Organizational cultures - an organization‘s
External Environment personality.

• External Environment - all outside factors that • Organizational climates - overall tone of the
may a ect an organization. workplace and the morale of its workers.
• Resources - the people, information, facilities,
infrastructure, machinery, equipment, supplies, and
• Directly interactive - immediate and rsthand
nances at an organization‘s disposal.
impact upon the organization.
• Managerial philosophies - the manager‘s set of
• Directly interactive forces (Micro environment) -
personal beliefs and values.
owners, customers, suppliers, competitors, and
employee unions. • Managerial leadership styles - the style for
problem-solving or decision-making.

• Indirectly interactive - secondary and distant

e ect upon the organization. CHAPTER 3: ORGANIZATIONAL CULTURES,
DIVERSITY, AND ETHICS
• Indirectly interactive forces (Macro
environment) - socio-cultural, political and legal, • Organizational culture - refers to a system of
technological, economic, and global in uences. shared assumptions, values, and beliefs.

• Socio-cultural dimension - demographics and

values of a particular customer base. Levels of Organizational Culture
• Political and legal dimensions - the regulatory • Assumptions - taken for granted and re ect
parameters within which an organization must beliefs about human nature and reality.
operate.
• Values - shared principles, standards, and goals.
• Technological dimension - the scienti c
• Artifacts - visible, tangible aspects of
processes used in changing inputs (resources,
organizational culture.
labor, money) to outputs (goods and services).
• Economic dimension - worldwide nancial
conditions. Dimensions of Culture
• Global dimension - factors in other countries that • Innovative Cultures - exible, adaptable, and
a ect organizations in another country. experiment with new ideas; characterized by at
hierarchy and titles.
• Aggressive Cultures - value competitiveness and
Internal Environment
outperforming competitors.
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 • Outcome-Oriented Cultures - outcome-oriented; • Stories and Language - the most colorful and
emphasizes achievement, results, and action. e ective to communicate culture.
• Stable Cultures - predictable, rule-oriented, and
bureaucratic. Creating Culture Change
• People-oriented cultures - value fairness, • Creating a Sense of Urgency - the need for
supportiveness, and respecting individual rights. change to employees.
• Team-oriented culture - collaborative and • Changing Leaders and Other Key Players -
emphasize cooperation among employees. vision that in uences how things are done in an
• Detail-oriented culture - precision and paying organization.
attention to details. • Role Modeling - the process by which employees
modify their own beliefs and behaviors to re ect
those of the leader.
Factors Most Important in the Creation of an
Organization’s Culture • Training - teaching employees the new norms and
behavioral styles.
• Founder Values - the personality, background, and
values of its founder or founders, as well • Changing the Reward System - employees are
as their vision for the organization. rewarded and punished.
• Industry Demands - industry characteristics • Creating New Symbols and Stories - developing
new rituals, symbols, and stories.

How Cultures Are Maintained

CHAPTER 4: ORGANIZING
• Attraction-Selection-Attrition - employees are
attracted to organizations where they t in, Process of Organizing
companies are looking for people: selection, • Identi cation of activities - identi es activities
attrition is the natural process where the which are performed by the organization.
candidates who do not t in will leave the
• Grouping of activities - activities are grouped in
company.
various ways.
• New Employee Onboarding - the process through
• Assignment of responsibilities - having
which new employees learn the attitudes,
completed the exercise of identifying, grouping and
knowledge, skills, and behaviors.
classifying of all activities into speci c jobs.
• Leadership -
• Granting authority - speci c responsibilities given
• Rewards Systems - the organization rewards to individual employees.
behaviors or results.
• Establishing relationship - a structure of
relationships in the organization.
Signs of Organizational Culture
• Mission Statement - a statement of purpose, Classi cation of Organization
describing who the company is and what it does.
• Formal Organization - refers to a structure of well
• Rituals - repetitive activities within an organization de ned jobs each bearing a measure of authority
that have symbolic meaning. and responsibility.
• Rules and Policies - determines acceptable and • Informal Organization - It refers to a network of
unacceptable behavior within an organization. personal and social relationships which
spontaneously originates within the formal set up.
• Physical Layout - a company’s building, layout of
employee o ces, and other workspaces.
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 Relationship between Formal and Informal • Bene t of Specialization - divides the enterprise
Organizations into parts and functional areas.
• Better co-ordination-Line - provide better
decision making and concentration remains in few
Organization Structure
hands.
• Line organization - This is the simplest form of
• Bene ts of Research and Development - gives a
structure and refers to a direct straight-line.
wide scope to the line executive to bring
Merits of Line Organization innovations and go for research work in those
• Simplest - the most simple and oldest method of areas.
administration. • Training -
• Unity of Command - superior-subordinate • Balanced decisions - achieved by line sta
relationship.
• Unity of action - a result of uni ed control.
• Better discipline - control is uni ed and
Demerits of Line and Sta Organization
concentrates on one person.
• Lack of understanding - confusion between the
• Fixed responsibility - every line executive has got
two.
xed authority, power and xed responsibility
attached to every authority. • Lack of sound advice -
• Flexibility - there is a co-ordination between the • Costly - the concerns have to maintain the high
top most authority and bottom line authority. remuneration of sta specialist.
• Prompt decision - due to the factors of xed • Assumption of authority - the power of concern is
responsibility and unity. with the line o cial but the sta dislikes it as they
are the one more in mental work.
Demerits of Line Organization
• Sta steals the show - the higher returns are
• Over reliance - decisions are implemented to the
considered to be a product of sta advice and
bottom, resulting in over-relying on the line o cials.
counseling.
• Lack of specialization - no scope for specialized
functions.
Merits of Functional Organization
• Inadequate communication - policies and
strategies which are framed by the top authority • Specialization - Better division of labour takes
are carried out in the same way. place which results in specialization of function and
it’s consequent bene t.
• Lack of Co-ordination - degree of e ective co-
ordination is less. • E ective Control - the mental functions are
separated from manual functions.
• Authority leadership - the line o cials have
tendency to misuse their authority positions. This • E ciency - Greater e ciency is achieved because
leads to autocratic leadership and monopoly in the of every function performing a limited number of
concern. functions.
• Economy - Specialization compiled with
standardization facilitates maximum production.
Line and sta organization
• Expansion - Expert knowledge of functional
• Relief to line of executives - the advice and
manager facilitates better control and supervision.
counselling.
• Expert Advice -
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 Demerits of Functional Organization
• Confusion - The functional system is quite
complicated to put into operation, especially when
it is carried out at low levels. Therefore, co-
ordination becomes di cult.
• Lack of Co-ordination - Disciplinary control
becomes weak as a worker is commanded not by
one person but a large number of people. Thus,
there is no unity of command.
• Con icts - There may be con icts among the
supervisory sta of equal ranks.

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