BUSINESS OVERVIEW
Business - an organization of people with varied skills which uses
property or talents to produce goods or services, which can be sold to
others for more than their costs.
KINDS OF BUSINESS
1. Commerce - refers to the transfer or exchange of goods and services
with the movement of goods from point of production to point of
consumption.
2. Industry - primarily concerned with the creation of form utility or the
production of goods that are used either by the consumer or by other
industries in the further production of other goods.
3. Services - enterprises that cater to personal needs of people or with
the rendering of a personal service.
WHY DO PEOPLE GO INTO BUSINESS?
1. Increase in activities that can make available goods and services
needed in the community.
2. Realize profit from investment.
3. Increase the value of the business as an economic entity.
4. Improve the quality of life in the community.
1.
2.
3.
4.
5.
6.
7. Protection
OTHER STUDIES RELEVANT TO BUSINESS
1. Statistics - deals with the study of mathematical tools, trends,
decisions and theories
2. Economics - deals with the study of scarce resources for the
satisfaction of human wants
3. Sociology - deals with the individuals relationship to society as a
whole
4. Psychology - deals with the study of the mind.
CONTROL FACTORS IN CHOOSING A BUSINESS
1. Available funds
2. Special aptitude and interest
3. Training and education
4. Social status of the business
5. Competitive situation
6. Location factor and social values of the particular community
7. Present or potential demand
8. Social significance of the business
Part II
THEORIES OF MANAGEMENT
1.
THEORIES OF MANAGEMENT
2.
3.
4.
5.
6.
7.
8.
9.
Part III
ORGANIZATIONAL NEEDS, MANAGEMENT
FUNCTIONS AND SYSTEMS
Organization - refers to the structure or form of an enterprise and the
arrangement of all parts thereof in aa manner suitable for use in service.
BASIC CONSIDERATIONS IN ORGANIZATION & MANAGEMENT
1. There should be a clear and complete statement of objectives.
2. There should be a thorough analysis of the entire proposition
surrounding the business.
ORGANIZATIONAL NEEDS
4. The men best fitted for the work and to head each department or
division should be selected
FUNCTIONS OF MANAGEMENT
System - planned methods of procedure
ADVANTAGES OF PROPER USE OF SYSTEM
1. The introduction of order and method wherever it is applied
2. Everyday work becomes routine through a system
3. It permits those in authority to devote their time and effort to more
important work
4. It aids in the control and reduction of costs
RULES FOR APPLYING SYSTEM
1. System used in a particular concern should reflect a basic general plan.
2. System must represent a definite and useful purpose.
3. Maintaining a system must prove its worth as against its cost.
1. Planning - it deals with chalking out a future course of action and
deciding in advance the most appropriate course of actions for
achievement of pre-determined goals.
2. Organizing - it is the process of bringing together physical, financial
and human resources and developing productive relationship amongst
them for achievement of organizational goals.
3. Staffing - it is the function of manning the organization structure and
keeping it manned.
4. Directing - it is that part of managerial function which actuates the
organizational methods to work efficiently for achievement of
organizational purposes.
5. Controlling - It implies measurement of accomplishment against the
standards and correction of deviation if any to ensure achievement of
organizational goals.
Part IV
BASIC PRINCIPLES OF MANAGEMENT
BASIC PRINCIPLES OF MANAGEMENT
1.
2.
3.
4.
Principle of Relationship of Task and Accomplishment principle which means that a person works best and accomplishes
most when he is given a definite job to be completed in a given time
.
5.
6.
7.
8.
9.
10.
11.
12.
Part V
BUSINESS
ORGANIZATIONS
[Sole Proprietorship and
Partnership]
Part VI
BUSINESS ORGANIZATIONS
[Corporation]
CORPORATION - an artificial being created by operation of law having the
right of succession and the powers, attributes and properties expressly
authorized by law or incident to its existence.
General Features of a Business Corporation
1. It is an artificial being.
2. The business operation is managed by the Board of Directors.
3. The capital is accumulated through the sale of stocks and bonds
representing units of ownership and entitling the stockholders to
receive dividends.
4. Stockholders may enjoy limited liability for business debts.
5. It has perpetual existence.
RIGHTS OF SUCCESSION
A corporation has the right to continuous existence irrespective of
the death, withdrawal, insolvency or incapacity of the individual members
or stockholders and regardless of the transfer of their interest or shares of
stock.
By Laws - refers to the body of rules and regulations that govern the
internal management of the organization.
Based On The Laws Of The State OrCountry From Which They Are
Created
A. Managerial Prerogatives
B. Individual Rights
3. Voting Right
Kinds of Voting Rights
a. Voting in person - stockholder casts his vote personally
N= SxD
1
# of shares
elected + 1
Where:
N
S
D
T
SAMPLE PROBLEM:
Total # of directors to be
T+1
= -------------------------------------- +
=
=
=
=
Sample Problem:
Paris Hilton would want to have 3 seats in the BOD of Venetian Hotel
which has 120,000 shares of capital stock, outstanding and 11 directors.
How many shares does Paris need to get 3 seats?
N=SxD
--------- + 1
shares
N = 120,000 x 3 + 1
--------------------
30,001
T+1
11 + 1
Problem 2:
Rachael Ray owns 80,000 shares in Food Network. The company has
150,000 shares of capital stock outstanding and 9 BOD. How many seats
can she get in the Board?
Where:
D
H
T
S
=
=
=
=
H-1xT+1
D = ---------------S
30,001 - 1 x 11 + 1
D=
------------------------
3 seats
120,000.00
Problem 1:
If Oprah would want to have 8 seats in the BBC Network which has
300,000 shares of capital stock outstanding and 15 directors, how many
shares does she need?
Problem 4:
Rajo Laurel owns 65% of the 700,000 shares of capital stock outstanding
in Lifestyle Asia Incorporated, for which there are 12 BOD. How many
seats would be available for him?
a resident and citizen of the Philippines] and such other officers as may be
provided in the by-laws.
Any 2 or more positions may be held concurrently by the same
person, except that no one shall act as president and secretary or as
president and treasurer at the same time.
Part VII
CLASSES OF STOCKS
1. Common Stock and Preferred Stock
a. Common stock - basic issue of shares and has all the basic rights
of a share of stock so that it is often referred to as the basic
ownership in a corporation.
b. Preferred stock - class of stock having preferences over common
stock.
2. Class "A" and Class "B"
a. Class "A" shares - are for Filipino shareholders
b. Class "B" - are for foreign investors.
3. Par Value and No-Par Value Shares
a. Par value shares - refer to shares of capital stock that have been
assigned a definite or fixed value in the articles of incorporation so
as to fix the minimum subscription or original issue price.
b. No-par value shares - those that have not have been assigned a
definite or fixed value.
CORPORATE OFFICERS
A corporation must have a president [who shall be a director], a
treasurer [who may or may not be a director], a secretary [who shall be
II.
f.
1. Government regulations
2. Labor union
3. Labor market
C. Selection and hiring
i.
2.
Reception of Applicants
3.
4.
5.
6.
Interview
Types of Interview
b. Dependability
c. Self-confidence
e. Creativeness
f.
g. Value system
b. Academic achievement - provides a good
indication of an applicants initiative, independence,
reliability, intellectual competence and emotional
stability
h. Critical attitude
7.
c. Experience
d. Appearance
e. Health
8.
a. Directive Interview
Selection - the process of determining who from among
the job applicants should get the job.
b. Non-directive Interview
c. Group Interview
9.
d. Team Method
Forms of Movement
A. Transfer - defined as the movement of employees from one
job to another on the same level in the organization with
more or less the same pay, privileges, duties and
responsibilities.
Kinds of Transfer
b. Failure to qualify or meet job standards
1. Promotion - refer to the upward movement of employees
in an organization from lower level jobs to higher level
jobs involving increases in duties and responsibilities,
higher pay and privileges
Bases for Promotion
a. Competency or merit
1
Types of Separation
b. Seniority
TypesOf Seniority
1. Straight seniority - means that length of service
alone determines employment preference.
2. Qualified seniority - means that length of service
is just one of a number of specified factors used to
Part VIII
V.
III.
Types of Pay
1. Productivity
Part IX
e. Self-actualization needs
2. Clay Alderfers ERG Theory- approach to motivation, which
specifies a hierarchy of 3 needs categories: existence, relatedness,
and growth
Part X
THE DYNAMICS OF LEADERSHIP
LEADERSHIP TYPES
1. Autocraticleadership- it demands obedience from his
subordinates through the use of formal authority, rewards and
punishments.
Authority
Leader
Follower
decentralize authority
Authority
Leader
4.Managers communicate.
4.Leaders persuade.
9.Managers exercise power over people. 9.Leaders develop power with people
Follower
Part XI
ORGANIZATIONAL COMMUNICATION
Communication - is the transfer of information and understanding from
one person to another through meaningful symbols.
MAIN ELEMENTS OF THE COMMUNICATION PROCESS
1. Sender - the source of information and the initiator of the
communication process
Authority
Leader
Follower
c. Organization
d. Repetition
e. Focus
2. Receiver - the person who receives and decodes the senders
message
Types of Messages
e. It should not overwhelm
a. Non-verbal message
b. Verbal messages
c. Written messages
Problems of Perception
4. Channel - the path that a message follows from sender to receiver
Types of Channel
4.1 Downward channel - communication paths that managers use
to send messages to employees or customers.
4.2 Upward channels - communication paths that subordinates use
to send information to superiors.
4.3 Horizontal channels - communication paths that managers and
employees use when communicating across departmental lines
3. Different goals
B. Individual Barriers
1. Semantics - the study of the way words are used and the
meanings they convey
2. Emotions - a subjective reaction or feeling
Characteristics of Feedback
a. It should be helpful.
2. Encourage feedback
Part XII
ORGANIZATIONAL BEHAVIOR
ELEMENTS OF O. B.
PEOPLE
ENVIRONMENT
ENVIRONMENT
ORGANIZATION
STRUCTURE
TECHNOLOGY
ENVIRONMENT
5. Use of information
Part XIII
TYPES OF INNOVATION
5. Reduce Resistance
c. Negotiation
e. Selecting a method
d. Cooptation
7. Implement change
8. Follow up the change
APPROACHES TO CHANGE
1. Technology-based approach
1. People values
2. Redesign approach
2. Group values
3. Task-based approach
3
4. People-oriented approach
Organization values