ENTREPRENEURSHIPBy:

Carlo R.

Maravilla

Lesson 1: LET US STUDY:

ACCOUNTABILITY- IS A SITUATION OF BEING ANSWERABLE TO HIGHER AUTHORITIES.

AUTHORITY- IS THE POWER OR RIGHT DELEGATED OR GIVEN TO A PERSON.

LINE ORGANIZATION- IS A TYPE OF ORGANIZATION WHICH IS CHARACTERIZED BY A SUPERIOR HAVING DIRECT COMMAND OVER WORKERS TO ACCOMPLISH THE TASK.

ACQUIRE FUNDAMENTAL SKILLS IN MANAGING A BUSINESS.

Line and Staff organization- is a type of organization where line officers have staffs who assist them but who do not have any authority over line personnel.

Organization Chart- is a diagram that shows the organizational relationships of the positions and their corresponding authority, responsibility, and accountability.

Responsibility- is the duty that one has to fulfill in connection with the performance of the job.

MANAGEMENT FUNCTIONS OF ENTREPRENEURS

Management functions are all the same to all organizations regardless of size or type. The only difference is the amount of emphasis given to each level. But in general, managers have to do the:

PLANNINGPlanning is the most basic

management function that tells you where to go and how to get there. It is like preparing a blueprint of what is to be done, when, how, and by whom it should be done.

CLASSIFICATION OF PLANSStanding Plans

These plans are used repeatedly and cover policies, procedures, and rules.

Single-used or Single-purpose PlansThese plans are essentially one-shot or non

repetitious. This is used within a relatively short period of time, they comprise programs, projects, and budgets. Programs are complicated; they are made up of objectives, goals, strategies, policies, rules, job assignments, financial resources and other pertinent items.

STEPS INVOLVED IN THE STRATEGIC PLANNING

1) Formulate Organization Objectives2) Analyze Present Resources3) Determine Alternative Courses of

Action4) Examine the Alternatives5) Select the best Course of Action6) Develop Support Plans7) Implement the Plan

ORGANIZINGORGANIZING INVOLVES IDENTIFYING THE SPECIFIC

ACTIVITIES NECESSARY TO ACHIEVE THE ENTERPRISE GOALS, CLUSTERING THE ACTIVITIES INTO DEPARTMENTS OR JOB POSITIONS, AND DESIGNATING THE PERSONNEL TO HEAD AND COMPOSE EACH DEPARTMENT.

An example of the organizing functions is the owner-manager of a small factory who establishes three departments – production department, sales department, and administrative department. He assigns manager to head each department and clearly delineates responsibilities among them. Thus, he give the production manager the responsibility for manufacturing, packing, and shipping, while he delegates to the sale manager the responsibility for advertising and costumer service. Then he assigns the administrative head to look after personnel, purchasing, and accounting.

A. LINE ORGANIZATION

The manager has direct command over workers who

accomplish the task.

BELOW IS AN EXAMPLE OF LINE ORGANIZATION

MANAGER

SUPERVISOR

FOREMAN

WORKERS

B. LINE AND STAFF ORGANIZATIONAny activities that a line officer can

not do are delegated to a staff officer to render these services. For example, in a small manufacturing enterprise, the president, production manager, and sales manager perform line functions, while legal counsel who helps and advices the president has no authority over line employee.

BELOW IS AN EXAMPLE OF LINE AND STAFF ORGANIZATION

PRESIDENT

LEGAL COUNSEL

S A L E S M A N A G E R PRODUCTION MANAGER

ADMINISTRATIVE MANAGER

C. FUNCTIONAL STAFF ORGANIZATION

In this setup, the worker has more than one immediate superior

or as many as the types of activities assigned to him.

MANAGER SUPERVISOR FOREMAN

QUALITY

CONTROL

PRODUCTION SPECIA

LIST

WORKERS

An example of Functional Staff Organization

STAFFINGThis process involves proper and effective selection,

appraisal and development of personnel to do the jobs and fulfill the roles in the structure.

A. Asses your Workload The officers manning the operating units can determine

what exactly they are responsible for. This information can be used as basis for defining the organizational structure, and the quantity and quality of personnel needed to handle the workload.

B. Study Jobs in the Company This refers to the process of determining the duties,

responsibilities of each job. The analysis can tell you whether or not the present workers have the required skills and abilities. You can also find out who else among the presents employees fit in each job.

C. Examine your Present Personnel ASSES THE SKILLS, STRENGTHS, WEAKNESSES, AND POTENTIALS.

COMPARE YOUR INVENTORY AGAINST YOUR FORECASTED MANPOWER NEEDS. YOUR FINDINGS WILL TELL YOU WHETHER:

a) YOUR COMPANY HAS JUST THE RIGHT QUANTITY AND QUALITY OF PEOPLE;

b) YOU HAVE AN EXCESS IN QUANTITY BUT ARE SHORT IN QUALITY; OR

c) BOTH QUANTITY AND QUALITY OF SKILLS OF YOUR PERSONNEL ARE INSUFFICIENT.

D. Design an Improvement Plan If you find out that there is a problem in quantity or quality of skills

among your present personnel, you may adopt any of the following solutions:

a) If your workers are not enough , consider recruiting from inside or outside the organization.

b) If your workers do not posses the required skills, you may resort to training and development.

DIRECTINGDIRECTING INVOLVES PUTTING YOUR PLANS

INTO EFFECT. HOW TO INFLUENCE OUR SUBORDINATES WHO HAVE DISTINCT NEEDS AND A UNIQUE PERSONALITY, TO CONTRIBUTE TO THE ATTAINMENT OF THE FIRM’S OBJECTIVES IS THE PRINCIPAL CONCERN OF DIRECTING.

Understanding certain principles will help you direct the actions of your subordinates towards the successful implementation of your plans.

DIRECTING INVOLVES THE FOLLOWING:

A. Motivation is the process of encouraging the subordinates to act in a desired manner. When an employee joins a company they bring with them certain needs which they hope to be able to satisfy.

a. Physiological needs these are needs for air, food, water, for survival.

b. Safety needs to be protected from danger, threat, or deprivation.

c. Esteem needs such as those for self-confidence, achievement, competence, knowledge, self-respect freedom and independence. It also includes the needs for status, recognition, importance, and respect.

d. Self-realization needs represent the needs for full development of potentials and of being creative.

B. Leadership is the ability of an individual to persuade the subordinates to follow. As a leader you need a mixture of skills to be effective. These skills may be required in varying degrees by managers in different situations. These skills include the following;

a. CONCEPTUAL SKILLS REFER TO THE MENTAL CAPACITY OF AN INDIVIDUAL TO GRASP THE RELATIONSHIP OF DIFFERENT PARTS INTO AN INTEGRATED WHOLE. THEY NEED THESE SKILLS IN PLANNING, AND ANALYZING.

b. Human relation skills is the ability to deal effectively with people.

c. Technical skills incorporate the capabilities to perform the mechanics of a certain job which the operative employees perform, like producing goods that the company manufactures.

CONTROLLINGTHE FUNCTION OF CONTROLLING IS TO

MAKE SURE THAT WHAT IS DONE IN THE ENTERPRISE CONFORMS TO WHAT HAS BEEN PLANNED. THE TWO MAIN ACTIVITIES INVOLVED HERE ARE COMPARING ACTUAL PERFORMANCE WITH DESIRED PERFORMANCE AND MAKING NECESSARY CONNECTIONS WHERE THERE IS DEVIATION FROM THE PLANS.

Steps In Controlling The Process

A. ESTABLISH STANDARDS. STANDARDS ARE SETS OF MEASUREMENTS AGAINST WHICH YOU CAN EVALUATE ACTUAL RESULTS.

Three common types of standards:Physical standards include quantity of products or services,

number of customers and clients, and quantity of clients or services.

Monetary standards are indicated in terms of peso values and include labor cost, selling cost, material cost, sales revenue, and gross profit.

Time standards refer to the speed with which job should be done or the deadlines for their completion.

A. Set performance measurements. It is also necessary to determine how often should you measure performance, who will do the measurement, and what form will the measurement take. An important consideration in determining appraisal is that it must be easy to do and easy to explain to your people.

B. Measure actual performance. This step can be easy for you if the standards are spelled out clearly and if what your personnel are doing can be determined clearly. It includes observation, oral and written reports, automatic methods, inspections, tests, and samples.

A. Compare performance with standards and analyze deviations. Control does not stop after measuring performance. Data about actual performance can be meaningless unless they are compared with desired performance. Then you should analyze the reasons for the failure to start the standards so that you can deal with the roots of the performance problems.

DEPENDING ON THE NATURE OF THE SHORTFALLS IN PERFORMANCE, YOU MAY CORRECT THESE SHORTFALLS BY RESORTING TO ANY OF THE FOLLOWING REMEDIES.

a) REVISING YOUR PLANSb) MODIFYING YOUR GOALSc) REASSIGNING WORKERSd) CLARIFYING DUTIES AND RESPONSIBILITIESe) HIRING ADDITIONAL STAFFf) FIRING PROBLEMS WORKERSg) STRONGER LEADERSHIP

CONTROLS CAN BE CLASSIFIED AS EITHER ORGANIZATIONAL OR OPERATIONAL. ORGANIZATIONAL CONTROLS ARE THOSE THAT MEASURE THE OVER ALL PERFORMANCE OF THE ORGANIZATION. OPERATIONAL CONTROLS EVALUATE DAY TO DAY ACTIVITIES AND SPOT AREAS WHERE YOU MAY NEED TO TAKE CORRECTIVE ACTIONS.

Effective Controls Have The Following Characteristics

THEY CONTROL THE PROPER ACTIVITIES. PEOPLE WILL NATURALLY BE CONSCIOUS ABOUT MEETING STANDARDS IF THEY ARE AWARE THAT THOSE ACTIVITIES WILL BE MONITORED. HOWEVER, YOU SHOULD TAKE CARE NOT TO CAUSE AN IMBALANCE BUT NOT CONCENTRATING TO MUCH CONTROL ON ONE GROUP OF ACTIVITIES AND EASING UP ON ANOTHER.

Control should be timely. “A stitch in time saves nine” a popular saying goes. Control must report deviation in time to enable you to deal with the problem before it is too late.

Controls should be cost effective. Controlling entails costs. You pay for the processing and monitoring that you use, like registers and computers, you pay for the personnel like the inspector, accountants, and inventory controllers. You also pay for the line personnel who work on the data scrap, production costs, and personnel report. But are all these practical and economical?

Controls must be accurate. Control measures must be accurate to have a good basis for the corrective actions.

Controls must be accepted. It is important that you people understand the purpose and benefits of the controls so that they will not feel that you have installed controls just because you don’t trust your men.