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MANAGEMENT OF ORGANIZATION
Chapter 1: Understanding the Nature and Concepts of Management.

MANAGEMENT
 The etymology of management comes from the Italian word Maneggiare, which means “to
handle”. Maneggiare derives from the Latin words manus which means “hand” and agere which
means “to act”.
 As the direction and coordination of the human and non-human resources of an organization to
achieve outputs.
 As the achievement of organizational objectives through people and other resources
A Basic Requirement in Management
 Effectiveness – is a central element in management process, which requires the achievement of
an objective.
 Efficiency – is also a central element in the management process, which requires that the
minimum amount of resources is used to achieve an objective.

Theory of Management
Mary Parker Follet (1868-1933)
 An American social worker, management consultant, and philosopher.
 Mother of Modern Management
 “Management is the art of getting things done through people”.
Frederic Taylor (1856-1915)
 “Taylorism”
 Father of Scientific Management
 “Management as an art of knowing what to do, when to do, and see that it is
done in the best and cheapest way.”
Peter Ferdinand Drucker (1909-2005)
 Management consultant, educator, author of 39 books of management
 “Management is a multi-purpose organ that manages the business and
manages managers and manages workers and work”
Henri Fayol (1841-1925)
 “Fayolism”
 “Management is to forecast and to plan, to organize, command, to
coordinate and control.
 Administrative Management Theory - focused more on entire organization by developing general
theories of what managers do and what management practice.
 The 14 principles of Management
1. Division of Work – task specialization to increase productivity.
2. Authority – the right to give orders and exact obedience.
3. Discipline – must be upheld in organizations, but methods for doing so can vary.
4. Unity of Command – an employee should receive orders from one supervisor only.
5. Unity of Direction – one head and one plan for a group of activities having the same direction.
6. Subordination of Individual interest to group interest – the interest of one employee should not
be allowed to become more important than to those of the group.
7. Remuneration – employee satisfaction depends on fair remuneration for everyone.
8. Centralization – this refers to how close employees are to the decision-making process.
9. Scalar Chain – employees should be aware of where they stand in the organization’s hierarchy, or
chain of command.
10. Order – the workplace facilities must be clean, tidy and safe for employees.
11. Equity – managers should be fair to staff at all times, both maintaining discipline as necessary
and acting with kindness where appropriate.
12. Stability of Tenure of Personnel – managers should strive to minimize employee turnover.
13. Initiative – employees should be given the necessary level of freedom to create and carry out
plans
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14. Esprit de Corps – organizations should strive to promote team spirit and unity.
Behavioral Management Theory
Elton Mayo (1880 – 1949)
 An Australian psychologist, a Harvard researcher and an academic organizational
management scientist.
 He conducted studies together with Hawthorne, the theories on Human Relations and
Scientific Management.
 His management theory states that employees are motivated far more by relational factors or
environmental factors. (Intangible
Motivators)
Abraham Maslow (1908-1970) – an American
psychologist, created the Maslow’s Hierarchy of
Needs.
 Physiological needs – all physical needs
necessary for the maintenance of human well-
being.
 Safety needs – the need for basic security,
stability, and protection.
 Belonging and love needs – these needs
follow after the physical needs have been
satisfied.
 Esteem needs – the needs for achievement,
respect, fame and glory.
 Self-actualization – after all needs have been
satisfied, an individual feels the needs of finding himself.

MANAGEMENT: ARTS or SCIENCE?

MANAGEMENT AS Management
A Science - reflected considered as an art as
in the fact that is based it deals with human
on a more or less elements. The
codified body of personalized
knowledge consisting application of skills
theories and principles regarding decision
that are subject to making, interpersonal
study and further skills among the
experimentation. employees and
application of various
principles to achieved
desired results.

ORGANIZATION – is a collection of people working together to achieve a common purpose. It is a

group of people that use knowledge and techniques, and work together in patterned relationships.

ORGANIZATIONS

GOVERNMENT PRIVATE

TYPES OF ORGANIZATIONS
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LEVELS of MANAGEMENT

Small Organizations Medium Organizations Large Organizations

Single
Top Managers Top Managers
Manager

Front Line Middle

Employees Managers Manager

Front Line
Employees Managers

Employees
What is a Manager?
 MANAGER is the one responsible for accomplishing the objectives of his particular
unit, which could be a whole organization, a particular department or a work group.
 MANAGER is one who plans, organizes, leads, and controls other individuals in the
process of pursuing organizational goals.
 MANAGERS are responsible for using materials and talents in the most economical and
productive manner

LEVELS of MANAGERS
 TOP MANAGERS – are responsible for the overall performance of the organization.
They formulate strategies, provide leadership, evaluate and shape the method of
organizing and control the direction of the organization in the effort to accomplish goals.
 MIDDLE MANAGERS – direct the activities of other managers and sometimes also
those of the operating employees.
 LOWER Level MANAGERS – are responsible for leading employees in the day-to-day
tasks which contribute to the organization’s goal.

Types of Managers
 LINE MANAGERS – are directly concerned with accomplishing the goals of the
organization. The decisions they make with regards to operations are expected to be final
and must be implemented.
 STAFF MANAGERS – are in charge of units that provide support to the line units. In
doing their work, they use special expertise to advise the line workers.
 ADMINISTRATORS – managers working in government or in nonprofit organizations.
Exercise #1
1) Briefly explain the importance of studying management.
2) Contrast effectiveness and efficiency and provide specific situation where it can be used.
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Exercise #2
Discuss among your peers, draw your concept of a manager/administrator and be ready
to present in the class.
Assignment:
1. Let the student search examples of public and private organization and explain the
difference.
Quiz
1. Pick out at least 5 positive and 5 negative characteristics of a manager and describe how
each characteristic affects organization (e.g. in business)
2. If you were establish your own organization what would be your type of organization?
Expound your reason.
Managerial Roles
Interpersonal Roles
 Figurehead – perform ceremonial and symbolic duties such as greeting visitors,
signing legal documents.
 Leader – direct and motivate subordinates, training, counseling and
communicating with subordinates
 Liaison – maintain information links both inside and outside organization, use
mail, phone calls meetings
Informational
 Recipient – seek and receive information links both inside and outside
organization use mail, phone calls and meetings
 Disseminator – forward information to other organization members, send memos
and reports and make phone calls
 Spokesperson – transmit information to outsiders through speeches, reports and
memos.
Decisional
 Entrepreneur – initiate improvement projects, identify new ideas, delegate idea
responsibility to others
 Disturbance Handler – take corrective action during dispute or crisis, resolve
conflicts among subordinates, adapt to environment crisis
 Resource Allocator – decide who gets resources, scheduling, budgeting, and
setting priorities.
 Negotiator – represent department during negotiation of union contracts, sales,
purchases, budgets and represents department interests.
Management Skills
 Conceptual – a manager must have the knowledge or the ability to see “big picture” of
any given situation to be able to create ideas and visualize plans for the future.
 Technical – a manager must possess specific knowledge and the ability to use different
techniques to achieve what they want to achieve.
 Human – this skill pertain to interpersonal relationship and the ability to work well with
other people.
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Planning
 The most basic of all managerial function.
 It is the process by which managers establish goal, define methods and think of these
strategies by which these goals are to be attained.
 It deals with plotting and jotting down of action plans and decisions in advance to
achieve the pre-determined goals of the organizations.
Nature of planning
 Planning s goal oriented.
 Planning is futuristic in nature.
 Planning exists in all managerial activities.
 Planning is not a guess word; it is based on facts and information.
 Planning is flexible.
Purpose of planning
1. Provide direction to managers and staff
2. Reduces improbability
3. Lessen waste and redundancy
4. Set standards used in controlling
5. Formulate a decision from several alternatives
Types of planning
1. Strategic Plan
 A high level overview of the entire business, its vision, mission, corporate objectives,
and values.
 This plan is the foundational of the organization and will form part of the long-term
decision. The scope of the plan can be two, three, five, or even ten years.
 Refers to the process of determining the major goals of the organization and the policies
and strategies for obtaining and using resources to achieve those goals.
Components of strategic plan
Vision - Where does the organization want to be five years from now?
Mission - Why does the company exist? What does it aim to achieve?
Values - How do you want to inspire the world? How do you want to be known?
2. Tactical Plan
 Describes the tactics the organization plans to use to achieve the ambitions outlined in
the strategic plan.
 Refers to the process of determining the contributions that subunits can with allocated
resources.
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3. Operational Plan
 Describes the day to day running of the company. The operational plan charts out a
roadmap to achieve the tactical goals within the life frame.
 Is the process of determining how specific tasks can best be accomplished on time
with available resources?
TYPES of Operational Plan
 Single use plan - Created or events/activities with a single occurrence, such as sales rally,
marketing campaign, and recruitment drive, etc. Single plans use plans tend to be highly
specific.
 Ongoing Plans - These plans can be used in multiple settings on an ongoing basis. It
could be a policy, set of rules or procedures. Ongoing plans can be changed or repeated
as required.

FIGURE 1
Types of Planning
Management Level Planning Horizon
TOP MANAGEMENT CEO, President, Vice- Strategic Planning ( one to
President, General ten years)
Manager, Division Heads
MIDDLE Fucntional Managers, Tactics to Intermediate
MANAGEMENT Product Line Managers, Planning (six months to 2
Department Heads years)
LOWER MANAGEMENT Unit Managers, First Line Operational Planning ( one
Supervisors week to one year)

Example: figure 2
PRESIDENT/ Responsible for strategic
GENERAL MANAGR Planning

MARKETING MANAGER
PRODUCTION MANAGER

FINANCE MANAGER
Responsible for
Intermediate
Planning PERSONNEL MANAGER

INDUSTRIAL ENGINEERING
FACTORY MANAGER QUALITY CONTROL MANAGER
MANAGER

Responsible for operational planning

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Planning at Different Levels of the Organization

TOP-LEVEL MANAGERS
 These are the chairperson, board of director, president, CEO (Chief Executive Director),
CFO (Chief Financial Officer) COO (Chief Operational Officer), Vice-president and
Corporate Head.
 Responsible for controlling and overseeing the entire organization.
 Play significant role in the mobilization of outside resources.
 Have great deal of managerial experience, most of them have an advanced degree such
as master in business administration, others have been groomed and trained, moved up
from the ranks and are part of the succession planning for high potential management
trainees.
 They set goals, leads the entire company to achieve goals set.

MIDDLE-LEVEL MANAGERS
 Those in the level below top managers. Their job titles include: general manager,
regional manager. Division manager, plan manager.
 Responsible for carrying out the goals set by top management. They set goals for their
departments and other business units.
 They motivate and assist first-line managers to achieve business objectives.
 They may communicate upward, by offering suggestions and feedback to top executives.
 They execute organizational plans in conformance with the company policies and
objectives.
 They define and discuss information from top management to lower management and
motivate guides low-level managers towards better performance.
 They implement effective group intergroup work and information systems. They monitor
group-level performance indicators, diagnose and resolve problems within and among
work groups, they design and implement reward systems.

LOWER-LEVEL MANAGERS
 Also called first line managers or supervisors.
 They have job titles such as office manager, department manager, store manager,
supervisor.
 Focus on controlling and directing.
 Responsible for the daily management of line workers or the employees.
 They do not set goals organization; they have an unyielding influence on the company.
 Daily activities is being supervised and monitored, ensuring the quality of work and
production is being done, and evaluation is implemented.
Planning tools and techniques
BRAINSTORMING
 The first crucial creative stage of the project management and planning process.
 Powerful technique that draws out ideas from a group of people.
 Creates new ideas, solve problems, motivates and develops teams.
 Needs to be structure and must follow brainstorming rules.
 Everyone must be able to see the total picture of the whole scenario so that each will
have a substantial contribution of ideas.
BRAINSTORMING Process
 Define and agree on the objective
 Brainstorm ideas and suggestions having agreed a time limit
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 Categories/condense(shorten)/combine/refine
 Assess, analyzes the effects or result
 Prioritize options/rank list appropriate
 Agree on action and timeframe
 Control, monitor, and follow -up
Fishbone Diagrams
 Also called “cause and effect” and Ishikawa Diagrams, named after Kaoru
Ishikawa (1915-1989).
A japanese professor who specializes in industrial quality manaagement and
engineering who devised the technique in 1960’s.
 Has a central spine running left to right, around which is built a map
factors which contribute to the final result or problem.
 Excellent for identifying hidden factors which can be significant in
enabling larger activities, resources areas or parts of a process.
 Very effective planning model and tool especially for mapping an entire
operation.

Figure 3

Gantt Chart
 Henry Laurence Gantt (1861-1919), was an American mechanical engineer and
management consultant, who is best known for his work in the development of
scientific management. Who devised the technique of Gantt chart in the 1910s.
 Excellent models for scheduling and budgeting, and for reporting presenting
and communicating project plans.
 The most flexible and useful project management tools at the planning stage
and for the large complex projects.
Figure 4

Decision Making
The job of a manager is to come up with a sound decision based on the facts, tools,
information, data, experience, and the knowledge that he is equipped.
It is a solution selected after examining several alternatives chose because the decider
foresees that the course of actions he chooses will do more than the other further his goals and
will be accomplished by the fewest possible objectionable consequences.
Steps in Decision Making
1. IDENTIFY THE PROBLEMS
2. SEEK INFORMATION
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3. BRAINSTORM SOLUTIONS
4. CHOOSE AN ALTERNATIVE
5. IMPLEMENT PLAN
6. EVALUATE OUTCOMES
Assignment
1. Before you end up in this school, have you considered other companies or government
agencies to look for employment?
2. Have you decided which job you would need in a particular organization?
3. How do you see yourself 5 years from now?
Activity 1
Group Activity: divide the class into 6 groups, each group will present a plan to put up a
small business using the planning tools discussed.
Acitivty 2
Now that you have learned to plan at different levels in the firm, in your opinion, which
among three level managers carry the biggest responsibility in the planning and decision
making? Defend your answer.
_____________________________________________________________________________
______________________________

Organizing
 It is a group of people that work together, coordinate and collaborate their actions to
achieve a broad scope of goals.
 This relates to the structuring of resources and activities to accomplish objectives in an
efficient and effective manner.
 The process of organization involves dividing the work in rational way and integrating
the activities with work situation and personnel.
 The structure of organization is a network of internal responsibility and authority
relationships.
BASIC elements of organizational structure
1. Work specialization- the degree to which tasks are divided in the organization.
Specialization promotes efficiency.
2. Departmentation – refers to the grouping of jobs based on criteria that managers
believe help in the coordination and control of activities.
3. Pattern of authority – as an element in designing organizational structure refers to the
extent by which organization members are allowed to make decisions without getting
the approval of another member.
Authority Patterns
 Centralized – when decision making is concentrated in the hands of higher-level
managers.
 Decentralized – when decision making authority is granted to middle and lower level
management positions.
4. Span of control – another consideration in designing the organizational structure.
Refers to the number of subordinates reporting to a single supervisor.
5. Coordination of activities – this term refers to the linking of activities in the
organization that serve to achieve common goal or objective.
Types of Organization Structure (formal Organizational Structure)
1. Line Organizational Structure
- Has an only direct vertical relationship between different levels in the firm.
- Directly involved in accomplishing the primary goal of the organization.
- Tends to simplify and clarify authority, responsibility and accountability.
- It promotes fast decision making and very simple to understand.
2. Functional Authority Organizational Structure
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- The line officers have the direct power to achieve the organizational goals.
- The staff officers have authority over the line.
(Staff personnel who are specialists in some fields are given functional
authority.
3. Divisional Organizational Structure
- Is the type where all activities needed to produce a good or service are
grouped together into dependent units.
- They are function, product, geographic territory, and project and combination
approach.
4. Matrix Organizational Structure
- It is a permanent organizational designed to achieved specific results by using
teams of specialists from different Fucntional areas in the organization.
- Decentralized decision making, improved environmental monitoring,
responses to change and has flexibility in the use of resources.
DELEGATION
- Is a process through which manager assigns responsibility to the subordinate with a
degree of authority.
Three major elements of delegation
1. Responsibility - the responsibility means assigning the work to an individual. The
manager assigns particular responsibility to the subordinates for the completion of
certain tasks on his behalf. An individual has to apply his physical and mental ability to
get the job completed efficiently
2. Authority – to fulfil the duty, certain authority is delegated to the subordinate. Authority
means the power to take decisions independently and accomplish the task efficiently.
The authority must be equal to the responsibility, this means, a certain level of authority
which is sufficient to complete the responsibility.
3. Accountability – means to check whether the subordinates are performing their
responsibilities in an expected manner or not. The accountability cannot be delegated
which means, in the case of non-completion of the task, the manager will only be held
responsible for it, not the subordinates.
Formal and Informal Organizations
 Formal Organization
1. It is a formed when two or more persons come together. They have a common
goal.
They are willing to collaborate to achieve this common goal.
2. Has its rules and regulation, these rules are documented. A formal
organization has a system of coordination. It also has a system of authority. It
has a clear superior-subordinate relationship.
3. Formed by the top level management.
4. Duties, and responsibilities, authority and accountability of each member are
well-defined.
5. The objective or goal is specific and well-defined. The main objectives of a
formal organization are productivity, growth, and expansion.
6. Shown on the organization chart.
7. Members of the formal organization get financial benefits like wages or
salaries, bonuses, allowances, health insurance, etc.
 Informal Organization
1. Exists within the formal organization. An informal organization is a network
of personal and social relationship. People working in a formal organization
meet and interact regularly. An informal organization does not have its rules
and regulation.
2. Is formed by the social within the formal organization.
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3. Does have to follow rules and regulation.

4. There are no fixed duties, responsibilities, authority accountability for the
members.
5. , the objectives are not specific and well-defined. The main objectives of an
informal organization are friendship, security, common in interest, individual
and group satisfaction.
6. Not shown on the organization chart.
7. Members of the informal organization get personal social benefits like
friends, community group, etc.
Activity 1
1. For instance, you and your family plan to go on vacation. What are the preparations that
you usually do? Do you plan a month ahead, a week or just days before the trip? What do
you consider in choosing a place to go on holiday? Do you check the accessibility of the
location? Budget? Time availability of everyone? The features of different locations?
Other things that you can enjoy while in the area? Once you decided where you want to
go, now is the time to make it happen.
 The first major decision, which is the location or the place, is what we can consider the
destination or the goal. The next set of decisions is more detailed and accurate. How do
you plan to get the destination? Is it by plane, bus or private car? What are the things that
you intend to take with you.
Activity 2
Design and illustrate your proposed organizational chart using one of the organizational
structures. {E.g. company (business), or government offices}
I. Give your own point of view in dealing with formal and informal organization or the
advantages and disadvantages.
____________________________________________________________________________________
_________________________________

Staffing
 As the selection and training of individuals for specific job functions and charging them
with the associated responsibilities in an organizational structure.
 As a management function that determines human resources needs, recruits, selects,
trains, and develop human resources for job created by an organization.
 It is a continuous activity for as long as the organization existing because the movement
of employees due to promotion and transfer take place continuously.
RECRUITMENT AND SELECTION PROCESS
STEP 1: IDENTIFY VACANCY AND EVALUATE THE NEED
• Recruitments provide opportunities to departments to align staff skill to sets to initiatives
and goals and for departmental and individual growth.
SOURCES of APPLICANTS
 The organization’s current employees
 Newspaper advertising
 Schools
 Referrals from employees
 Competitors
STEP 2: DEVELOP JOB DESCRIPTION
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• A job description is the core of a successful recruitment process. It is used to develop

interview questions, interview evaluations and reference check questions.
• The following are the content of the job description:
1. General information- Position title, Pay grade, Position level, Department, Department
head, immediate superior.
2. Position Purpose- Objectives of the position.
3. Essential job functions- describe the duties and responsibilities of the position.
4. Minimum requirements- basic qualifications required for the position.
5. Preferred qualification- Preferred qualifications are skills and experience preferred in
addition to basic requirements and can be used to narrow down the pool of applicants.
STEP 3: DEVELOP RECRUITMENT PLAN
• Each position requires a documented Recruitment Plan, which is approved by the
organizational unit. The recruitment plan is typically develop by the hiring manager in
conjunction with Department HR Coordinator.
STEP 4: SELECT SEARCH COMMITTEE
• To ensure applicants selected to interview and final considerations are evaluated by more
than one individual to minimize the potential for personal bias, a selection committee is
formed. The hiring manager will identify members who will have direct and indirect
interaction with the applicant in the course of the job.
STEP 5: POST POSITION AND IMPLEMENT RECRUITMENT PLAN
• Once the position description has been completed, the position can then be displayed.
Every effort should make to ensure the accuracy of the job description and posting text.
STEP 6: REVIEW CANDIDATE AND DEVELOP SHORT LIST
• Once the job has been posted, candidates will apply via email or personal appearance.
All applicants must be reviewed and considered. It is recommend that all search
committee members review all applicants to ensure more than one person assesses their
qualification and that individual’s opinion or biases are avoided.
STEP 7: CONDUCT INTERVIEW
• The interview is the single most important step in the selection process. It is the
opportunity for the employer and prospective employee to learn more about each other
and validate information provided by both.
STEP 8: SELECT HIRE
• Once the interviews have been completed, the committee will meet to discuss the
interviewees. Committee members will need to assess the extent of which each one met
their selection criteria.

STEP 9: FINALIZE RECUITMENT

• Once a final check in the selection process has been completed, and the final applicant
has been determined, the Committee Chair or designee will notify the Departmental HR
Coordinator of the finalist's name, salary and start the date.

TRAINING and DEVELOPMENT

- A training program allows you to strengthen those skills that each employee needs to
improve. A development program brings all employees to a higher level so they all have
similar skills and knowledge.
TYPES of Training
1. TECHNICAL OR TECHNOLOGY TRAINING
Technical training is a type of training meant to teach the new employee the
technological aspects of the job. It might include teaching someone how to use the
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computer system, how to use customer relationship management (CRM) system, and the
server needs to be trained on how to use system to process orders.
2. QUALITY TRAINING
In a production- focused business, quality training is extremely important. It refers to
familiarizing employees with the means of preventing, detecting, and eliminating non-
quality items, usually in an organization that produces a product.
ISO- (international organization for standardization, provides stamp of quality approval
for companies producing tangible products.
3. SKILLS TRAINING
Training includes proficiencies needed actually to complete the job. A think of skills
training as the things you need to know to perform your job.
4. SOFT SKILLS TRAINING
Soft skills refer to personality traits, social graces, communication, and personal habits
that are used to characterize relationships with other people.
5. TEAM TRAINING
The goal of the team training is to develop cohesiveness among the team members,
allowing them to get to know each other and facilitate relationship building. As a process
that empowers teams to improve decision-making, problem-solving, and team-
development skills to achieve business result.
6. MANAGERIAL TRAINING
After someone has spent time with an organization, they might be identified as a
candidate for promotion. This might include those from soft skills section, such as how
motivate and delegate, while others may be technical in nature.
7. SAFETY TRAINING
Safety training is a type of training that occurs to ensure employees are protected from
injuries caused to work-related accidents. It also includes evacuation plan, fire drills, and
workplace violence procedures.

COMPENSATION and BENEFITS

- Compensation describes the cash rewards paid to employees in exchange for the
services they provided. It may include base salary, wages, incentives, and commission.
(SALARY or WAGE is a fixed amount paid in exchange for an employee’s
services. It is a monetary remuneration computed on hourly, daily, weekly or
piece work basis paid by an employer to an employee in exchange for work
done.)
Wage and wage-related benefits given to workers
1. Minimum wage – is the lowest remuneration that employers may legally pay to workers.
2. Holiday Pay – the payment of an employee’s daily basic wage for all non-working
regular holidays.
3. Overtime Pay – more than 40 hours in a workweek.
4. Vacation Leave – 13 vacation days, with additional 1 vacation day every year starting on
2nd year of service and convertible to cash at the end of each year. Maximum vacation
leave is 18 days.
5. Parental Leaves
Maternity Leave – 60 days for normal delivery, 78 days for a caesarean delivery, for up
to four pregnancies.
Paternity Leave – all married male employees are entitled to 7 days paternity leave for
the delivery or miscarriage of his legitimate spouse for up to four pregnancies.
Solo-Parents Leave – Republic Act no. 8972. Parental leave of not more than 7 working
day every year shall be granted to any solo parent employee who has rendered service at least 1
year.
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6. 13th Month Pay – it’s mandatory, equivalent to 1 month’s basic pay salary to employees
with at least 1 year of service and must be paid before December 24.
7. Separation Pay – it is the amount due to the personnel where the termination of
employment is due to causes authorized by law.
8. Retirement Pay – it is the amount to be paid to employee who has reached the
compulsory retirement age or who availed of voluntary retirement.
INCENTIVES
Three key types of incentives
1. BONUSES: Individuals are rewarded based on attainment of performance- based goals
(individual, team and company).
2. PROFIT SHARING: Payment is tied to company profits. Profit-sharing bonuses are
paid out once a year in the form of cash or on a deferred basis.
3. COMMISSIONS: Commissions are a common way to remunerate employees (sales
people) for securing the sale of a product or service.
PERFORMANCE APPRAISAL
Performance evaluation is done in systematic ways which are as follows:
1. The supervisors measure the pay of employees and compare it with targets and plans.
2. The supervisors analyze the factors behind the work performances of the employees.
3. The employers are in a position to guide the employees for better performance.
Advantages of Performance Appraisal
Promotion: Performance Appraisal helps the supervisors to chalk out the promotion
programs foe efficient employees.
Compensation: Performance Appraisal helps in chalking out compensation packages
foe employees.
Employees Development: The systematic procedure of performance appraisal helps the
supervisors to frame training policies and programs.
Selection Validation: Performance Appraisal helps the supervisors to understand the
validity and importance of the selection procedure.
Motivation: Performance Appraisal serves as a motivation tool.
EMPLOYEE RELATIONS
- Maintaining a strong employer and employee relationship can be the key to the ultimate
success of an organization, the results are advantageous.
Benefits of strong employment relations
1. PRODUCTIVITY
Strong employment relations create a pleasant atmosphere within the work environment;
it increases the employee motivation and can also be increased through improved
employee morale.
2. EMPLOYEE LOYALTY
Creating the productive and pleasant work environment has a drastic effect on an
employee's commitment to the firm, it encourages a loyal workforce.
3. CONFLICT REDUCTION
When a work environment is efficient and friendly, the extent of conflict within the
workplace is reduced. Fewer conflict results in the employee are being able to
concentrate on the tasks at hand and they are therefore more productive.
REWARD SYSTEM
• In the broadest sense of the word, performance evaluation and reward systems are
designed for employee development and raising motivation with the purpose of
achieving better and more visible results.
• In all successful companies at home and abroad, reward system s are established
practices with certain common and specific characteristics because the system cannot
only be copied from one organization to another.
 15

Activity
If you were a hiring a manager, what qualifications will you look for in hiring employees
who will work in your company? What points will you consider in your recruitment? Would you
consider competencies over skills or vice versa?

Group Activity
1. Create core competencies and skills that you will look for a candidate based on a
position in your company.
2. Research on other employee training program.
RUBRICS: Content-10 points Grammar and Logic Ideas and Sample Scenarios-10
points
Activity 2
SELF EVALUATION FORM
RATING:
95-100 – Excellent
90-94 – Very Good
85-89 – Good
80-84 – Fair
75 – 79 – Passed
70 below failed
1. I have made it a point to listen as much as I speak.
2. I stayed on topic. (Group activity, etc.)
3. Sustained interest on a certain subjects/topics.
4. Seek “hows” and “whys” rather than taking them for
granted.
5. I follow rules and regulations (house rules/schools
rules).
6. Have materials/ideas for the subjects.
7. Helped people when asked/needed.
8. Act politely.
9. Accept extra duties.
10. Being honest to yourself and to others.

_____________________________________________________________________________
______________________________

Leading/Directing
 Involves guiding, inspiring and leading people so that accomplished predetermined
objectives.
 16

 The function of directing influences the subordinates and motives them in meeting the
organization's goals.
 Deals with a human factor which is complex and therefore presents challenges to
directors.
 Direction is a continuous function, and therefore, management must supervise and guide
his subordinates at all times for work to go as planned.
Leading versus Managing
Vision and Strategy Policies and Procedure
Creating Value Counting value
Influence and inspiration Accomplish a goal Power and control
Have followers Have subordinates
Explain vision
Leading people Managing work
People focused Organizations Work focused
Charismatic style figureheads Authoritarian style
Risk & change seekers Risk averse & stability
Appeal to the heart Motivate others Appeal to the head
Proactive Reactive
Sets direction Mobilize resources Plans detail
Raising Expectations Maintain status quo
Ask questions Give directions

1. Leadership inspires change; management manages transformation.

2. Leadership requires vision; management requires tenacity.
3. Leadership requires imagination, management requires specifics.
4. Leadership requires abstract thinking; management requires concrete data.
5. Leadership requires ability to articulate; management requires ability to interpret.
6. Leadership requires an aptitude to sell; management requires an aptitude to teach.
7. Leadership requires an understanding of the external environment; management requires
an understanding on how works gets done inside the organization.
8. Leadership requires risk-taking, management requires self-discipline.
9. Leadership requires confidence in the face of uncertainty; management requires a blind
commitment to completing the task on hand.
10. Leadership is accountable to the entire organization; management is accountable to the
team.
LEADERSHIP Theories
Traits Theories - What Type of Person Makes a Good Leader?
Trait theories
 Effective leader share some common personality characteristics, or “features.”
 Help us identify traits and qualities that are helpful when leading others.
Traits of effective leaders
1. Personal Drive
2. The desire to lead
3. Personal integrity
4. Self-confidence
5. Analytical ability
6. Knowledge of the company, industry and technology
7. Charisma
8. Creativity
9. Flexibility

Behavioral Theories - What Does Good Leader Do?

 17

Behavioral theories
 Focus in how leaders behave and assume that leaders can be made, rather than born and
successful leadership is based on definable, learnable behavior.
Three types of leaders, Kurt Lewin (1930)
1. Autocratic Leaders (authority)-make decisions without consulting their teams.
Considered appropriate when decisions need to be made quickly when there’s no need
for input, and when team agreement isn’t necessary for a successful outcome.
2. Democratic Leaders (democracy) - allow team to provide input before making a
decision, although the degree of input can vary leader to leader. This style is important
when team agreement matters, but it can be difficult to manage when there are lots of
different perspectives and ideas.
3. Laissez-faire Leaders - don't interfere; they allow people within the team to make the
decisions. This works well when the team is highly capable, is motivated, and doesn’t
need close supervision. However, this behavior can arise because the leader is lazy or
distracted; this is where this style of leadership can fail.
Contingency Theories - How Does the Situation Influence Good Leadership?
The realization that there is no one correct type of leader led to theories that the best
leadership style depend on the situation. These theories try to predict which style is the best in
which circumstance.
Power and Influence Theories - What is the Source of the Leader's Power?
Authority and influence theories of leadership take an entirely different approach-these
are based on the different ways that leaders use power and influence to get things done, and they
look at the leadership styles that emerge as the result.
French ad Raven’s Five Forms of Power
BASES of POWER
The power possessed by leaders may be classified according to various bases.
P 1. Legitimate power. A person who occupies a higher position has legitimate power over
O
S
persons in lower positions within the organization.
I 2. Reward power. When a person has the ability to give rewards to anybody who follows
T
I orders or requests, he is said to have reward power.
O Two forms of reward power
N
A  Material rewards – refer to money or other tangible benefits
L
 Psychic rewards – consists of recognition, praises and so on.
P 3. Coercive power – when a person compels another to comply with orders through threats
E
R
or punishment.
S 4. Referent power – when a person can get compliance from another because the latter want
O
N to be identified with former, that person is said to have referent power.
A
L
5. Expert power – experts provide specialized information regarding their specific lines of
expertise. People possess this influence, called expert power, with great skills in
technology.

Role of Communication in the Organization

1. Employee's Trust
Clear, open communication can create sense of transparency in your organization, which
builds trust between levels of employees. Open communication can reduce feelings on
uncertainty and cluelessness about the state of the company, which makes for a more positive
environment and staff to feel secure and safe.
2. Clarity
By making roles and responsibilities clear to everyone on staff, you can give your
employees the information they need to get their jobs done; this is particularly important when
your employees are disperse or come from different backgrounds.
3. Collaboration
 18

Communication can help your employees collaborate effectively, which will make for a
more productive team overall. Communication can ensure that everyone is on the same
page and prevent problems down the road.

Management of Change and Diversity in the Workplace

Workplace diversity refers to a variety of differences between people and organization.
Diversity comprises gender, race, religion, language, cognitive style, organizational function,
education, background and more.
Benefits of Workplace Diversity
1. Increased Adaptability
Organizations employing a diverse workplace can supply a greater variety solution to
problems in service, sourcing, and allocation of resources.
2. Broader Service Range
A diverse collection of skills and experiences (e.g. Languages, cultural understanding)
allows a company provide service to customers on a global basis.
3. Variety of Viewpoints
A diverse workforce that feels comfortable communicating varying points of views
provides a larger pool of ideas and experiences.
4. More Effective Execution
Companies that encourage diversity in the workplace inspire all of their employees to
perform to the highest ability. Company-wide strategies can then are executed; resulting in
higher productivity, profit, and return on investment.

Activity 1
Expound your answer.
“When you’re a leader …. Everything is your fault.” How would you interpret this
quotation? Do you agree that when you are a leader, all the negative things that will happen in
your team is your fault?
Activity 2 (5 points each)
1. Explain the importance of leading to managers.
2. Cite ways to influence others
3. From the various traits of a leader, rank them based on what you think should be the
most and the least important trait a leader must possess.
4. Cite scenarios where each of the skills a manager should applied.
Activity 3
Identify a manager of your choice. Describe his leadership style. Are there important
changes that have to be made to improve his style? What are those? List down the proposed
character changes applicable.
_____________________________________________________________________________
______________________________
 19

Controlling
 One of the main functions of management. It comes after planning, organizing, staffing,
leading/directing. Aimed at determining if objectives were realized and by providing
means for achieving unrealized goals.
 It is the measurement of accomplishment against the standards and correction of
deviations to assure attainments of objectives according plans. (Knootz & O’Donnell)
 Determining what is being accomplished that is, evaluating the performance and if
necessary, applying corrective measure so that the performance takes according plans.
(G.R. Terry)
 Consists in verifying whether everything occurs in conformity, is with the plans adopted
the instructions issued and principles established. It has for its object to point out
weaknesses and errors to rectify them and prevent recurrence. (H. Fayol)

Control Methods and System

 Control techniques or methods are described as either quantitative or non-quantitative.
Quantitative Method – use data and various quantitative tools to monitor and control
production output.
 Chart- The most widely recognized quantitative tool, the visual impact of a
chart often provides the quickest method of relating data.
{Most charts are Versions of either the Gantt chart or the Program Evaluation and
Review Technique (PERT)}
• Non-quantitative Method - are those which are used by managers in performing
other managerial functions
The two common quantitative tools are:
1. The budgetary control
 Budgets are the most widely used control system because the plan and control resources
and revenues are essential to the firm’s health and survival.
 Budgeting is the formulation of plans for a given future period in numerical terms. By
stating plans regarding numbers and breaking them into parts of an organization, budgets
correlate planning and allow the authority to be delegated without loss of control.
2. Audits
 Internal auditing provides an independent review and appraisal of accounting, financial,
and other non-tactical operations.
 Audit measures and evaluates the effectiveness of management controls.

 Performance standards
 Top managers control their organization by establishing certain performance
standards. These performance standards are often just more clearly defined
objectives.

Role of Budget in Planning and Control

 20

• Budgets are necessary to highlight the financial implications of plans, to define the
resources required to achieve these plans and to provide a means of measuring, viewing
and controlling the obtained results, in comparison with the plans.
• Budgets are excellent communication tools, pointing out the operational and financial
objectives of the period.
• Budgeting helps set standards that can control the use of a company’s resources and
control and motivate the employee.
Preparation of Budget Plan
 Preparing your Budget
It can take a lot of time and effort to draw up an actual budget. So start work on it
as soon, as is possible, don’t leave until you have the application form to fill in.
 Working out your budget
Make sure that the figures are as accurate as possible, don’t just guess, and ask
other similar organizations what their costs get estimates or use catalogs or the internet to
find out how much things are.
You might want to break down your budget into groups that include things like:
 Staff- salaries, national insurance, travel and training etc.
 Premises-rent, heat, light, insurance, cleaning etc.
 Resources-books, subscription, etc.
 Admin/Stationery-stamps, phone, stationery, photocopying, etc.
 Training and Development- Training fees, development costs.
 Reviewing the Budget
 Budgets aren’t simply a means of getting a grant. They also act as guide
during the year as to whether you are spending your money as planned; it will
also warn you if you are under or over spending in unexpected areas. Your
committee should look at your budget every month to check spending against
income and review your fundraising activities if necessary.
Activity 1
Based on the cartoon presented on the springboard, what do you think is their main
problem? Have they been looking for solutions? What do you think they could have done to get
the desired result?
 21

Activity 2
MONTHLY BUDGET (family)
Item Budget Actual Difference Notes
Amount Amount
Income
Income Total
Other Income

Expenses
Rent
Household Maintenance
Taxes
Life Insurance
Electricity
Water
Gas
Phone/Cellphone
Entertainment
Groceries
Cable
Fuel
Auto/Motor Insurance
Car/Motor Payment
Credit Cards/Debt/Loans
Clothing
Child support (if any)
 22

Other

Savings

Total Income-Total Expenses = __________________________

*Make a budget of your household expenses using the template provided.

Reference:
Business Organization and Management, by Roberto Medina, 2015, Rex Bookstore.
Organization and Management by Edilynda G. Enriquez 2016